Early in the American session, the Euro (EUR/USD) is trading around 1.0534, above the 21 SMA, and below the 200 EMA.
On the 1-hour chart, we can see the EUR/USD pair has bounced above the psychological level of 1.05 and around 2/8 Murray located at 1.0498. In the next few hours, we expect that the euro can recoup part of last week's losses on the condition it consolidates above 1.0557.
The war between Israel and Hamas continued to intensify during the weekend. The only beneficiary of this war is gold which rallied rapidly, putting pressure on the euro. However, it is technically expected that EUR/USD can recover part of the losses this week as the euro is showing overbought signs.
In case the euro consolidates above 1.0498, there is the possibility of a further rise and it could reach 3/8 Murray at 1.0620.
On the other hand, a sharp break and a close below the psychological level of 1.05 on the daily chart, there is a possibility that the euro continues its bearish movement and the instrument could reach 1/8 of Murray at 1.0376 and could even reach 0/8 of Murray around 1.0253.
Our trading plan for the next few hours is to buy Euro at the current price levels with targets at 1.0557 and 1.0620. The eagle indicator is giving a positive signal which supports our bullish strategy.
