Early in the European session, EUR/USD is trading around 1.0935, above the 21 SMA, above 3/8 Murray, and within the uptrend channel forming on the H4 chart since February 16.
Last week, the euro was about to reach the psychological level of 1.10 but found a strong rejection below 4/8 Murray. Now we see signs of exhaustion. A technical correction is likely to occur in the coming days and the euro could reach 200 EMA located at 1.0849.
According to the chart above, we observe that the euro is trading above 3/8 Murray and the 21 SMA. This could favor a bullish move of the euro and it could reach 1.0955 and eventually, it the top of the uptrend channel around 1.0975.
If the euro breaks and consolidates below 1.0925, the outlook for the euro could change. So, we could expect a technical correction with the price reaching 2/8 Murray at 1.0864 and even the bottom of the uptrend channel around 1.0848.
Additionally, a sharp break below the 200 EMA and a break of the uptrend channel could be the start of a trend reversal. Hence, the euro could reach 1.0700 in the short term.
In case the euro finds good support around 1.0850, the outlook could be positive and EUR/USD could resume the bullish cycle which could be seen for us as a buying opportunity, with targets at 1.0925 and at the psychological level of 1.10.
