Early on another September Monday, the major currency pair is looking rather weak and retreating to its five-week low. At the moment, is trading at 1.1710.
The American currency was significantly supported by the report for August – the indicator added 15.1% y/y. The report confirmed market players’ idea that the US Federal Reserve may reduce its stimulus program before the year-end, as planned.
The data released last week didn’t resonate with investors, as well as other published reports.
In the H4 chart, after breaking 1.1800 to the downside and finishing another descending structure at 1.1711, EUR/USD is expected to form a new consolidation range near the lows. If the price breaks this range to the upside, the market may continue the correction to test 1.1800 from below. After that, the instrument may form a new descending wave with the target at 1.1650. From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is falling towards the lows.
As we can see in the H1 chart, after finishing another structure of the third descending wave and reaching the target at 1.1711, EUR/USD is expected to consolidate near the lows. After that, the instrument may break the range to the upside and start another correction with the first target at 1.1745. From the technical point of view, this scenario is confirmed by the Stochastic Oscillator: after breaking 20 to the upside and leaving the “oversold area”, its signal line is steadily moving towards 50, a breakout of which may lead to further growth to reach 80.
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