Early in the American session, the Euro is trading around 1.0837. It is making a slight technical bounce after reaching a low of 1.0805. The risk aversion that dominates the markets in the face of the escalation of the conflict between Ukraine and Russia benefits the US dollar against the euro.
The US dollar is supported by the conviction that the Federal Reserve will begin its cycle of adjustments in its monetary policy at the meeting on March 16, where the market consensus is in favor of an interest rate increase of 25 basis points, which would be followed by three or four rate hikes during the rest of the year.
According to the daily chart, it can be seen that the euro has reached the bottom of the downtrend channel format since January 28.
The area of 1.08 represents a key level for the recovery of the euro. A close on daily charts above 1/8 Murray around 1.0864 could favor the move higher and reach 3/8 Murray at 1.1084 and towards the top of the downtrend channel at 1.1142.
The eagle indicator has reached the extreme oversold level and a technical correction is imminent in the next few hours towards the zone 2/8 Murray around the psychological level of 1.1000.
Our trading plan is to buy at the current price levels around 1.0837. As long as EUR/USD remains trading above 1/8 Murray, it can sustain our bullish view with targets at 1.1084.
