The Euro (EUR) is currently trading around 1.0540 against the US Dollar (USD). Market expectations suggest a 65% probability of a 25 basis point rate cut by the Federal Reserve in the next meeting. Coupled with strong US economic data, the dollar is gaining strength. However, the USD is nearing its October 2023 high, and without further fundamental changes, a short-term breakout seems unlikely. As a result, non-USD currencies are primarily seeking support confirmation.
If the EUR/USD pair falls below the recent low of 1.0500, there could be a downward acceleration. On a daily chart level, the pair is in a low-range fluctuation, with only a slight rebound observed recently. The pair did not break the 1.0500 level, suggesting a wait-and-see approach for a directional move after the current fluctuation. If it stabilizes above 1.0600, it may enter an oversold rebound range.
It’s essential to note the significant deviation in daily moving averages and the KDJ indicator’s oversold signals, indicating limited probability for continued rapid decline and suggesting a period for indicator correction.
On a 4-hour chart, EUR/USD is in a low-range consolidation phase. The direction will likely be more apparent once the moving averages align. The structure shows that if the pair does not break the previous low around 1.0496, a rebound might occur, with resistance expected at 1.0600.
