Although it was a public holiday in the United States yesterday, the euro showed a modest decrease. By and large, if it were not for the absence of American traders, the drop in the euro could be more significant.
The single European currency was bullish last week. The euro overlooked the published statistics and grew for no reason. So, a correction is something essential and logical at the moment.
The euro is likely to be edging down today as well. It may show a fall similar to the one we saw yesterday. Although the public holiday in the US is over and traders are getting back to work, today’s macroeconomic calendar will be empty.
The euro/dollar pair is now in a corrective move after a strong uptrend. The quote returned to the level of 1.1400. Judging by the price’s behavior, the 1.1400 mark is seen as support, with no trend taking place alongside it.
The Relative Strength Index left the overbought zone on the H4 chart and approached 50, confirming a flat market.
The Alligator indicator signals an impending reversal on the H4 chart, which is confirmed by the consolidation of the MAs above 1.1400. Notably, two of the three MAs cross, raising doubt about a trend reversal.
Speaking of the daily chart, there is no indication of a reversal emerging. Instead, the 7-week flat turned into a downside correction.
Outlook
The current standstill along the level of 1.1400 plays a key role in the market. Its limits are seen at 1.1380 and 1.1435. Consolidation outside one of the limits on the H4 chart may reveal the quote’s further direction.
Long positions could be considered after the price settles above 1.1435, with the target at 1.1480. Short positions could be entered after consolidation below 1.1380, with the target at 1.1360.
In terms of complex indicator analysis, there is a variable signal for short-term and intraday trading due to a flat market around 1.1400. Technical indicators also signal to sell the asset in the intermediate term, indicating a downtrend.