FX.co ★ EUR/USD – October 8: The FOMC Minutes Had No Significant Impact

On Wednesday, EUR/USD made another reversal in favor of the U.S. dollar and another consolidation below the 127.2% retracement level at 1.1220. Thus, the decline may continue toward the 1.1081–1.1086 support level. A new consolidation above 1.1220 would favor the euro and some upward movement toward the 100.0% retracement level at 1.1325, while also bringing the pair closer to the end of the bearish impulse.

The wave structure on the hourly chart remains bearish. The latest completed downward wave broke below the previous low, while the new upward wave did not come close to the previous high. Following the September FOMC meeting, traders expect at least one more monetary policy tightening before the end of the year and another one next year. This factor continues to provide strong support for the U.S. currency. However, bears are currently gaining momentum, which also helps the dollar continue to rise.

The information background on Wednesday was moderate. The minutes of the September FOMC meeting were released in the United States; at that meeting, the central bank raised its interest rate for the first time in three years. It is obvious that the minutes also had a hawkish tone. However, was this really a surprise to anyone? Did the dollar rise on the basis of the minutes? Apparently not. If bears were selling the euro during the day based on minutes that had not yet been released but were expected to have a hawkish tone, then the U.S. currency may remain popular among traders for a long time. In this case, every new statement from the Fed or from an FOMC committee member that does not rule out further monetary policy tightening could result in another rise in the dollar. However, this would still be the same event. Repeating the same message 20 times does not change anything — the Fed will still raise rates only once before the end of the year. Thus, there is no clear correlation between the minutes and the latest selling pressure from bears. The decline in the pair appears to have continued for some time not because of Fed monetary policy alone, but because of the combined effect of all factors, reinforced by the market's strong preference for the U.S. currency.

On the 4-hour chart, after forming three bullish divergences, the pair eventually reversed in favor of the euro and consolidated above the 127.2% retracement level at 1.1221. However, the upward movement did not last long. Bears are attacking again, while the CCI and RSI indicators may form new divergences and enter oversold territory in the near future.

Commitments of Traders (COT) Report:

During the latest reporting week, professional traders opened 17,475 Long positions and 28,397 Short positions. The total number of Long positions held by speculators currently stands at 238,000, while the number of Short positions stands at 301,000. Bears remain in control, and the euro continues to be sold more often than it is bought, which can be attributed to the complex geopolitical situation in the Middle East and Kevin Warsh's strong determination to achieve lower inflation. The market continues to believe that inflation will be reduced to 2% by any available means.

Overall, over the long term, major market participants continue to show strong interest in the euro. Events of various kinds around the world, which have been abundant in recent years, inevitably affect investor sentiment and put pressure on risk-sensitive currencies. And 2026 may set a record for the number of events that could not have been predicted in advance. Therefore, traders can only adjust their strategies as circumstances develop.

News Calendar for the United States and the European Union:

• United States — Change in Initial Jobless Claims (12:30 UTC).

On October 8, the economic events calendar contains one minor entry. The economic background will have no influence on market sentiment on Thursday.

EUR/USD Forecast and Trading Advice:

Long positions can be considered today after a close above 1.1220 on the hourly chart, with a target of 1.1325. Short positions could be considered after consolidation below 1.1220, with the target at the 1.1081–1.1086 support level. These positions can remain open today with a protective Stop Loss in place.

The Fibonacci levels are drawn from 1.1325–1.1712 on the hourly chart and from 1.1325–1.1712 on the 4-hour chart.