Early in the American session, EUR/USD was trading around 1.0411 reaching the top of the downtrend channel forming since November 22nd.
During the European session, the euro had a strong bullish rally reaching a high of 1.0426. Given that the euro is below the downtrend channel, we believe that a technical correction could occur in the next few hours. So, we will look for opportunities to sell below 1.0425 with the target at the 21 SMA located at 1.0324.
We could expect the instrument to reach the psychological level of 1.005. EUR/USD could even reach 7/8 Murray at 1.0620.
Our outlook remains negative for the euro. So, below 1.0496, we will look for opportunities to sell EUR/USD in the short term with the target at 1.0250.
