EURUSD consolidates the previous losses within a six-week-old rising channel, forming part of a multi-day-long bearish flag chart formation, currently between 1.0760 and 1.0590. It’s worth noting that the firmer RSI (14) line, not overbought, joins the bullish MACD signals to favor the Euro pair’s further recovery towards the 1.0760. However, a convergence of the 100-SMA and the 200-SMA, around 1.0800, appears a tough nut to crack for the bulls afterward. In a case where the quote remains firmer past 1.0800, the bearish bets will be off the table and will enable the buyers to challenge the late August swing high of around 1.0950.
Meanwhile, the 50-SMA level of around 1.0620 acts as an immediate downside support to watch during the EURUSD pair’s fresh downside. Following that, the stated bearish flag’s bottom line of near 1.0590 will be crucial as a break of which will theoretically confirm the pair’s gradual fall toward the sub-1.000 region. However, the yearly low marked in October around 1.0445 and the August 2022 peak of around 1.0380 could test the Euro bears on their way.
Overall, the EURUSD is likely to remain in the recovery mode but the upside room appears limited. That said, today’s speech from the European Central Bank (ECB) President Christine Lagarde and Fed Chair Jerome Powell will be crucial to watch for clear directions.