The EUR/USD pair experienced a dip to 1.0825 last week but has since been moving sideways. The initial bias for this week remains neutral, with a further fall likely as long as the minor resistance at 1.0896 holds. If the pair falls below 1.0825, the next target will be the 55-day Exponential Moving Average (EMA) at 1.0815. A sustained break below this level could indicate that the rebound from 1.0601 has completed with three waves up to 1.0947, potentially leading to a target of the 1.0601/0665 support zone. However, a break above 1.0896 could bring a retest of the 1.0947 resistance instead.
Looking at the bigger picture, the price actions from 1.1274 are seen as a corrective pattern that is still in progress. A break of the 1.1138 resistance would be the first sign that the rise from 0.9534 (2022 low) is ready to resume towards 1.1274 (2023 high). On the other hand, a break of the 1.0665 support level could extend the correction with another downward move back towards the 1.0447 support.
In the long term view, a bottom is believed to be in place at 0.9534 (2022 low). A sustained break of the 55-month EMA (currently at 1.1013) would increase the likelihood of a long term reversal. However, a firm break of the structural resistance at 1.2348 would be needed to confirm this reversal. If rejected by the 55-month EMA, the bearish trend could continue, potentially leading to a further decline from the 1.6039 (2008 high) through 0.9534 at a later stage.
In conclusion, the EUR/USD pair is currently facing key levels and resistance points that could determine its future direction. Traders and investors will be closely watching the price action around these levels to assess the potential outcomes and make informed decisions in the forex market.
