Hello, dear traders!
Yesterday, the EUR/USD pair stopped declining and corrected slightly despite the lack of positive outcomes in the military operation between Russia and Ukraine and the fact that the US President Joe Biden officially announced a ban on Russian energy imports, including oil and gas. These facts were probably significant for the market. However, the market could take a break before resuming its downtrend. Notably, the European Central Bank (ECB) will hold a meeting on Thursday. Later, ECB President Christine Lagarde will traditionally run her press conference. I believe these events will not favor the single European currency. Many European countries are highly dependent on Russian gas. However, the US is demanding that the EU sever all economic ties with Russia, isolating it. Moreover, the Fed and the ECB have significantly divergent monetary policies. The analytical departments of some major commercial banks expect the Fed to raise the key interest rate four times this year. As for the economic situation concerning the single European currency, I note that ECB chief economist Lane suggested that the military special operation in Ukraine could hurt eurozone GDP and provoke a decline of 0.3-0.4% this year.
Today, the economic calendar contains no eurozone releases. As for the USA, reports on the vacancy rate and the labor force fluctuation will be published at the end of the day. Therefore, today the EUR/USD pair will likely be influenced by the market sentiment and technical factors. These aspects will be discussed now.
Daily
After hitting the level of 1.0806, the pair found strong support and rebounded upwards. As mentioned above, yesterday the EUR/USD pair rose and tried to return above the significant technical level of 1.0900. However, the euro bulls failed to do it and trades closed at 1.0897 on March 8. Today, the pair continues yesterday's correction and it is trading near 1.0920 at the time of writing this review. As seen on this timeframe, yesterday the level of 1.0958 exerted pressure on the pair. The pair rebounded, leaving a long upper shadow in the candlestick. The nearest target for the euro bulls are yesterday's highs. If the bulls manage to change them and close today's trading at higher levels, further upward trend is likely. Notably, the ECB meeting is scheduled tomorrow. Later, Christine Lagarde will deliver a speech. Besides, in case the pair rises today and the trading session closes above yesterday's highs, the next target for the euro bulls will be a psychological level of 1.1000 and above 1.1040 with the red Tenkan line of the Ichimoku indicator. I think these prices are competitive to open sell trades. However, the pair is unlikely to reach them.
H4
On the 4-hour chart, the previous Doji candlestick with the highs at 1.0930 is clearly seen. If the current candlestick closes above this level, another test of the sellers' resistance at 1.0958 is expected. In case of a breakout and fixation above this level, it is possible to buy the pair with the nearest targets at 1.1000, 1.1020 and 1.1040. If the current candlestick is bearish and closes below 1.0930, it is advisable to sell the pair with the nearest target at 1.0855. I recommend closely monitoring the candlestick signals on the 4-hour and hourly charts. The situation may change at any moment. Therefore, traders will have to make a decision about entering the market
Good luck!