Early in the American session, the EUR/USD pair is trading around 1.0823, bouncing above the 200 EMA below the 21 SMA. Since the euro reached the psychological level of 1.10, we have observed a strong technical correction and now the euro is showing oversold signs. So, a technical rebound is expected in the coming hours.
In the 4-hour chart, we can see that the euro is trading within the bearish trend channel and is expected to continue bouncing until EUR/USD reaches the top of this channel, which coincides with the 21 SMA and the line of 5/8 Murray around 1.0864.
In case the Euro breaks below 1.08, we could expect it to continue falling and it could reach 4/8 Murray at 1.0742 and even the psychological level of 1.05.
Given that the euro is showing oversold signs, we can take advantage of the opportunity to buy only if EUR/USD consolidates around 1.0801.
Market sentiment shows that there are 43.56% who are buying the euro. Hence, if this data decreases, we could expect a recovery in the euro and it could reach 1.0986 (6/8 Murray). If it breaks sharply out of the downtrend channel, it could return to the 1.10 -1.12 levels.
