Early in the European session, the EUR/USD pair is trading around 1.0758, above the 21 SMA, and above -1/8 Murray. On the H-4 chart, we can see that the Euro is trading within a bearish trend channel formed since August 18.
On the 4-hour chart, we can see that gold is touching the top of the downtrend channel. It means that if a break above 1.0770 occurs, we could expect EUR/USD to reach the 200 EMA at 1.0852 in the next hours.
In the American session, US inflation data will be published, which is expected to trigger a strong volatile movement. If the data is negative for the US dollar, the instrument could cover the GAP that was left at 1.0700 and could even reach the bottom of the downtrend channel around 1.0650.
In the chart above, we can see that the eagle indicator reached the extremely oversold zone on September 11. Since then, it has been giving a positive signal. However, we can see that the euro is facing a strong resistance zone. If it fails to consolidate above 1.0770, we could see a technical correction towards the 1.0650 area.
We expect that in the next few hours, EUR/USD will consolidate above 0/8 Murray which could be seen as a signal to buy with targets at 1.0803 and 1.0864. Below 1.0740, the signal could always be negative. Below this area, the euro would be at risk of further fall in the coming days and could even reach 1.0500.
