Early in the American session, the euro is trading around 1.0285, making a strong technical correction after having reached the top of the downtrend channel at about 1.0434. Now, the euro is approaching support levels which means that consolidation is likely to occur.
If the euro bounces around 4/8 Murray in the next few hours, it could be seen as an opportunity to buy as technically, a double-bottom pattern could be formed.
If the bearish force prevails, we could expect the euro to reach the bottom of the downtrend channel at about 1.0182.
Technically, the euro is under bearish pressure. So, we believe that in case there is a technical bounce and EUR/USD consolidates below 1.0347 (21 SMA), it will be seen as a signal to sell.
The next key support is located around 3/8 of Murray at 1.0131. This level could represent a strong bottom and a good point for the euro to get a technical bounce. However, we should pay attention to 1.0253. Above this area, the euro is likely to reverse its direction.
