The EUR/USD pair was trading in the green at 1.0911 on the H1 at the time of writing. After its massive drop, the rebound was natural. You knew from the previous analysis that the price could test and retest the near-term resistance levels before turning to the downside again. Technically, the price action developed a bearish pattern, but we still need confirmation.
Fundamentally, the US Flash Manufacturing PMI came in worse than expected on Friday confirming further contraction, while Flash Services PMI came in better than expected but worse compared to the previous reporting period. On the other hand, the Eurozone and German manufacturing and services data came in worse than expected.
EUR/USD reached a supply zone
From the technical point of view, the EUR/USD pair developed a Rising Wedge pattern, which could announce a new leg down. It has reached the 1.0917 - 1.0907 resistance zone.
Its failure to approach and reach the broken downtrend line announced exhausted buyers. Still, a valid breakout through the upside line, a new higher high activates a larger growth.
EUR/USD outlook
A new lower low, a bearish closure below 1.0899 represents a selling signal as the Rising Wedge would be activated.
