Early in the American session, EUR/USD is trading around 1.0737, below the 0/8 Murray, and below the 21 SMA located at 1.0774.
According to the H1 chart, we can see that the euro is within a downtrend channel formed since August 29. A technical rebound is expected to occur in the next few hours.
At the opening of the American session, the euro touched the bottom of the downtrend channel. It means that EUR/USD could recover in the next few hours.
EUR/USD pair reached 1.0715. This level coincides with the weekly support. From this level, the euro is expected to continue its bounce. On the way, the instrument could approach the zone of 1.0774 (21 SMA) and reach the top of the bearish channel around 1.0790.
A recovery in the euro could be expected on the condition it trades above the 200 EMA located at 1.0830. Above this level, EUR/USD is likely to reach 3/8 Murray at 1.0925 and even the psychological level of 1.10.
On the other hand, the main trend remains bearish. With any technical bounce and as long as the instrument trades below 1.0830, we could treat this opportunity as a clear sign to sell in the short term.
Our trading plan for the next few hours is to buy the euro above 1.0715 with targets at 1.0774 and 1.0890. The eagle indicator is in the oversold area. Therefore, we expect a technical correction in the coming days.