EUR/USD Forecast 18 Jun 2026: Warsh Breaks 1.1500 Floor

By Ken Chigbo · Founder, KenMacro · 18+ years in markets, London trading floor and institutional FX

Find Ken on X @realkenchigbo · YouTube @Realkenchigbo · MACRO MASTERY Discord

Updated 2026-06-18 06:30 BST · cross-referenced against FXStreet, Investing.com, TradingEconomics, forex.com, Yahoo Finance, CME FedWatch.

The euro just lost the floor. Most of the desk’s inbox spent yesterday arguing whether Kevin Warsh would protect the dovish path he inherited or rewrite it on day one. He rewrote it. EUR/USD broke 1.1500 on the hawkish hold, DXY ripped through the 100 handle, and the cleanest expression of a widening Fed-minus-ECB path gap is doing exactly what it tends to do when the dollar gets a re-rating shock.

The Macro Setup Behind the EUR/USD Forecast

Yesterday’s FOMC was always going to be a regime event, not a rate event. Kevin Warsh chaired his first meeting and held the target range unchanged at 3.50 to 3.75 percent on a unanimous 12 to 0 vote. The decision itself was never the story. The story was the Summary of Economic Projections: the median 2026 federal funds dot lifted to roughly 3.8 percent from 3.4 percent in March, which sits above the current 3.625 percent midpoint. That single revision flipped the signal from a cut bias to a hike bias, with roughly half the committee now pencilling in a hike this year. The Fed’s own projections page is the cleanest record of the shift, and the statement stripped the prior easing bias entirely.

Warsh, true to his long-standing scepticism of forward guidance, leaned into data-dependence and dropped the hand-holding. The drivers behind the hawkish lean are not subtle: inflation is still above target, producer prices are running hot, and the live Strait of Hormuz oil risk is creating an inflation tail the Fed cannot ignore. The transmission was textbook. DXY ripped through the 100 handle, trading 100.20 with a post-decision spike to roughly 100.40, the highest in over two months. The most Fed-sensitive short-dated Treasury yields surged as the curve priced higher-for-longer, possibly higher. Gold flushed about 2 percent to a session low near 4,219 before stabilising around 4,302, capped under the 4,345 to 4,350 barrier. The S&P 500 sold off from its 16 June reference close of 7,548.60 and the Nasdaq led the downside as the most rate-sensitive index. The full live read on this regime is the kind of thing that drops daily inside the MACRO MASTERY desk.

For the euro this is the cleanest setup in the FX complex. EUR/USD has repeatedly traded as the purest expression of the Fed-minus-ECB path gap, and the ECB sits roughly where the market expects it to stay while the Fed just told everyone to stop assuming cuts. The ECB’s own communication track has not shifted to match. The gap widened in one print. The desk had the 1.1620 area flagged into the decision as the offered liquidity that mattered, and the 15 June rejection at 1.1617 was the lower high that defined the structure. Warsh did the rest. By contrast with the post-FOMC sessions where the Fed protected a cut path, this print actively repriced the dollar higher. The geopolitical layer, with the US-brokered Israel, Lebanon and Iran framework still fraying, keeps a live war premium under crude and reinforces the inflation tail. Our broader EUR/USD forecast hub and the live world interest rates dashboard both flagged this convergence into the print.

Multi-Timeframe Read on the EUR/USD Forecast

On the daily, the structure is clean. The 15 June high at 1.1617 printed below the prior swing high and stalled into the 1.1650 to 1.1660 supply shelf. That is a textbook lower high. Price then rolled, and Warsh accelerated the move into yesterday’s New York session. The 1.1500 round-number floor went, and 1.1505 is the spot reference this morning, a fresh roughly three-month low. The daily candle structure is in lower-low motion: lower high above, fresh swing low below.

Step down to H4 and the picture is consistent. The rejection wick at 1.1617 left an unmitigated supply zone that extends into the 1.1650 to 1.1660 shelf, and every bounce off 1.1500 in the run-up to the decision failed to even retest the lower high. The intraday tape, post-FOMC, was a one-way move; the spread held through the print, then widened on the spike, and 1.1500 broke cleanly without a defended-bid attempt. There is no twice-defended intraday low above 1.1435 worth naming, which tells you something on its own. The MACRO MASTERY desk covers FOMC live as the prints land, and the read on this particular tape was that the lack of a defended bounce off 1.1500 was the tell.

The cross-asset confirmation matters here. DXY at 100.20 is above the 100 round level it has been wrestling with for months. The S&P 500 is offered. The Nasdaq is leading the downside. WTI is firm on the geopolitical bid. Every component of a hawkish-Fed, dollar-bid, risk-off regime is checking out at the same time, which is the kind of confluence that tends to extend rather than fade in the first 24 to 48 hours after a regime shift.

Scenario Map for the EUR/USD Forecast

Bear scenario (primary). Price stays capped below the 1.1617 lower high and works the 1.1500 retest from below as resistance. In this scenario the path of least resistance points toward the 1.1435 2026 low, which is the major downside magnet and the next liquidity pool below the break. The driver is the Fed-minus-ECB path gap widening further, which keeps the dollar bid through any minor euro bounce. Cross-asset confirmation comes from DXY holding above 100 and US short yields refusing to fall back. In this case EUR/USD tends to grind lower in stair-step fashion, with failed retests of 1.1500 marking the structure.

Bull scenario (counter). A clean reclaim back above 1.1617 on a daily close would neutralise the immediate bearish read, because that is the lower high that defines the structure. In this scenario the next liquidity pocket sits in the 1.1650 to 1.1660 supply shelf, and a break through that opens the prior range. The catalyst would be a soft US data print (jobless claims, PCE, payrolls) that walks the market’s hawkish Fed repricing back, or a clear ECB hawkish surprise that narrows the path gap from the other side. Without one of those, this scenario stays the low-probability tail.

Final Takeaway on the EUR/USD Forecast

EUR/USD is the cleanest expression of a hawkish-Fed dollar re-rating, and Warsh just gave it the catalyst. While price stays capped below 1.1617, the bearish leg is valid, with 1.1500 as the broken-floor-turned-resistance and 1.1435 as the major downside magnet. The five-lens framework, including the daily-routine dashboard, is unpacked in detail inside the MACRO MASTERY desk, and understanding how leverage compounds in regime shifts like this is covered in the desk’s primer on leverage in forex.

“The path gap did the work. Warsh just printed the receipt.”

Educational analysis only. Past performance does not guarantee future results. Manage risk against your own portfolio.

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