Early in the American session, EUR/USD was trading around 1.0620. According to the 4-hour chart, we can see a consolidation above the 21 SMA. In addition, we can see that it is breaking the downtrend channel formed since February 13.
EUR/USD has formed a bearish wedge pattern which is a sign that we could expect a recovery in the next few hours and this could reach the 200 EMA located at 1.0692 and could reach the area of 4/8 Murray.
It is expected that in the next few hours the euro will consolidate above 1.0580. The daily pivot point is located at this level, which could offer a positive outlook for the euro and then it could reach the 1.0750 area in the short term.
On the contrary, if the euro falls below 1.0575, we could expect a continuation of the downward movement and this could reach the 2/8 Murray area located at 1.0498. In the event that this scenario occurs, we could sell only if the euro consolidates below the 21 SMA.
Our trading plan for the next few hours is to buy above 1.0585 (21 SMA) with targets at 1.0645, 1.0692 (200 EMA) and 4/8 Murray (1.0742). The eagle indicator is giving a positive signal which supports our bullish strategy.