FX.co ★ Trading Signal for EUR/USD on January 4-5, 2023

Early in the American session the Euro is trading around 1.0951 below the psychological level of 1.10 and below the 6/8 Murray and the 21 SMA.

According to the H4 chart we can see that the EUR/USD is trading inside a downtrend channel, since December 27th it is likely that if it fails to break this channel and if it consolidates below 1.0986, we could see a continuation of the downward movement.

If this possibility occurs the euro could reach the 200 EMA at 1.0900, this is a strong support for the pair. In case the bullish pressure prevails and falls below 1.09 we could expect a bearish acceleration towards 4/8 Murray at 1.0742.

On the other hand, if the euro breaks and consolidates above 1.086 (6/8 Murray) and above 1.0980 (21 SMA) it could mean a resumption of the bullish cycle and could reach 1.1073 and could even reach 7/8 Murray located at 1.1108.

Our strategy for the next hours will be to sell the Euro below 1.0986 (6/8 Murray), with targets at 1.0930 and 1.0900 (200 EMA). The eagle indicator since December 26th is giving a negative signal and is trading within a bearish trend line which supports our bearish strategy.