Early in the American session, the Euro (EUR/USD) is trading around 1.0945 within an uptrend channel formed since October 31 and below +2/8 Murray.
In recent hours, the euro has been showing some exhaustion of bullish strength and a technical correction is expected to occur if EUR/USD trades below 1.0964.
Investors continue to be optimistic as the euro approaches the psychological level of 1.1000. If this level is rejected, the euro could suffer a sharp technical correction.
On the other hand, the FOMC minutes will be published in the next few hours. Investors await some clues about the US interest rate cut. Investors believe that there will be a 1.00% interest rate cut in 2024.
In case the euro reaches the top of the trend channel around 1.0964 or it reaches +2/8 Murray located at 1.0986, it could be seen as an opportunity to sell. The eagle indicator is giving overbought signals. A strong technical correction is likely to occur in the coming hours.
On the other hand, in case the euro consolidates above 1.0986, it is expected that it could reach the psychological level of 1.10. The price could even reach the high of August 10 at 1.1064.
Our trading plan for the next hours is to sell the euro below 1.0964 or 1.0986 with targets at 1.0900 and 1.0780 (the bottom of the bullish channel).
A sharp break of the downtrend channel and a daily close below 1.0740 would change the euro's outlook and initiate a bearish cycle so that EUR/USD could reach 6/8 Murray at 1.0498.