- EUR/USD hovers below the psychological resistance at 1.0900.
- A break above the 14-day EMA at 1.0916 could lead the pair to reach the major barrier at 1.0950.
- Technical indicators suggest a bearish sentiment towards the key support at 1.0850.
EUR/USD edges higher to near 1.0890 during the Asian session on Tuesday. The EUR/USD pair consolidates due to the uncertainty over the uncertainty over the timing of a potential interest rate cut by the European Central Bank (ECB). However, the ECB is expected to maintain its current Main Refinancing Operations Rate of 4.5% in its upcoming policy meeting on Thursday.
The EUR/USD pair could find immediate resistance at the psychological level at 1.0900. A breakthrough above the barrier could support the pair to surpass the 23.6% Fibonacci retracement at 1.0914 aligned with the 14-day Exponential Moving Average (EMA) at 1.0916. If the pair gains further movement, it could explore the area around the major level at 1.0950.
The 14-day Relative Strength Index (RSI), a momentum oscillator gauging the speed and direction of price movements, is positioned below the 50 mark. This positioning indicates a leaning towards bearish sentiment in the market for the EUR/USD pair.
Furthermore, the trend-following momentum indicator, the Moving Average Convergence Divergence (MACD), reinforces the confirmation of a bearish trend. The MACD line is positioned below the centerline, signaling a bearish stance. Additionally, there is a divergence below the signal line, adding further weight to the indications of a downward trend in the EUR/USD pair.
The EUR/USD pair could meet the key support at the 1.0850 level in conjunction with the monthly low at 1.0844. A break below the latter could push the pair to navigate the area around the psychological support at 1.0800.
EUR/USD: Daily Chart
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