Early in the European session, the Euro (EUR/USD) is trading around 1.0464 with a strong bearish trend and is above and below 2/8 Murray.
This strong movement in the Euro could mean that it still has a way to go to reach the 1/8 Murray zone located at 1.0376. However, according to the daily chart, we can see that the euro is oversold and we hope that in the coming days, it could resume its bullish cycle if it consolidates above the psychological level of 1.0500.
EUR/USD remains under strong downward pressure due to the strength of the US dollar index (USDX). The index reached the level of 107.00 which keeps the euro under downward pressure. However, technically it is also showing overbought signs, so a technical correction could favor the recovery of the instrument.
Another factor that causes investors to continue taking refuge in the US dollar is the combination of risk aversion sentiment and the increase in the yields of US treasury bonds. It proves that the euro remains under strong downward pressure.
According to the daily chart, we can see that the eagle indicator reached the extremely oversold zone, which is technically expected to lead to a recovery of the euro in the coming days. To do this, the key would be to wait for the price to consolidate above 1.0500 (2/8 Murray).
Our trading plan for the next few days will be to buy the euro only if it shows signs of a technical rebound and if it consolidates above 2/8 Murray. We buy with targets at the 21 SMA located at 1.0641 and finally towards 4/8 Murray at 1.0742.
