The EUR / USD pair is trading below the 21 SMA and above the 200 EMA. Now it is trapped at the level of consolidation. After having broken the main uptrend channel, it is making a correction movement towards the top of the bearish channel.
The Euro was affected by Lagarde's comments. She said that high inflation is expected to be temporary and also added that the economic recovery would evolve little by little. Eventually, the policymaker said that the central bank would continue with the purchase program of emergency bonds (PEPP) at 1.85 billion euros until at least March 2022.
The outlook for the EUR / USD pair is clouded, since there is a lot of supply of currencies. The pair could continue its fall in the medium term to levels of 1.15. In addition to this, the downward pressure that the US dollar is exerting could be more negative for the Euro.
According to the 4-hour chart, the Euro is maintaining its strength, as it is above the 200 EMA located at 1.1790. The breakdown and consolidation below this level could trigger a fall to the 1.1718 support zone. If the downward pressure prevails, the price could reach the 1.1657 support zone.
We expect a pullback to the top of the bearish channel located at 1.855. At this level. there will be a good opportunity to sell with targets at 1.1779. On the contrary, a technical bounce around the EMA of 200 (1.1790) will bring a good opportunity to buy. If the pair consolidates below this level, we should avoid buying.
Support and Resistance Levels for September 09 - 10, 2021
Resistance (3) 1.1891
Resistance (2) 1.1870
Resistance (1) 1.1842
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Support (1) 1.1793
Support (2) 1.1773
Support (3) 1.1774
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Trading tip for EUR/USD for September 09 - 10, 2021
Sell if there is a pullback at 1.1855 (SMA 21), with take profit at 1.1795, stop loss above 1.1890.
Buy if the pair rebounds at 1.1779 (1/8), with take profit at 1.1840 (2/8), stop loss below 1.1745.
