Christine Lagarde did not specify any specific date for the start of the European Central Bank's interest rate cut cycle, but she reaffirmed her remarks that borrowing costs could be lowered in the near future. Judging by the interest rate futures, most market participants are already assuming that the first rate cut will not take place in the summer, but in April. So, it's not surprising that the euro has firmly moved lower. It appears to be just the beginning of a fairly prolonged trend. Of course, there will be various stops and rebounds along this path, but this will be purely local.
The EUR/USD pair, during market speculation, returned to the levels seen at the beginning of the trading week, indicating an increase in the volume of short positions.
On the four-hour chart, the RSI indicator is moving in the lower area of 30/50, confirming the increase in selling volumes.
On the same chart, the Alligator's MAs are headed downwards, corresponding to the current cycle.
OutlookKeeping the price below 1.0850 may extend the downtrend, thereby strengthening short positions. However, in case the price returns above this level, we may witness a scenario similar to the beginning of the trading week.
The complex indicator analysis points to a downtrend in the short-term and intraday periods.