Early in the American session, the euro is trading above the 21 SMA and around 1.0779, reaching the top of the downtrend channel forming since March 8. We see some recovery since EUR/USD bounced around 1.0720.
This level is decisive for the euro. If EUR/USD manages to consolidate above 1.0760, it is expected to continue rising in the coming days and could reach the 200EMA located at 1.0836.
On the contrary, in case the euro falls below the 21 SMA, we could expect the bearish cycle to resume and the price could reach 0/8 Murray located at 1.0742 and could even reach -1/8 Murray located at 1.0711. Breaking this level could enable a fall towards the psychological level of 1.05.
Below 1.0760, the outlook could be negative for the euro. Above this area, we could look for opportunities to buy. The US Nonfarm Payrolls will be released this week. So, the market is likely to enter consolidation and indecision starting tomorrow until the data is released on Friday.
Our trading plan for the next few hours is to buy the euro above 1.0768 with targets at 1.0803 and 1.0833. Below 1.0760, we could put our stop loss or avoid buying.
