EUR/USD Price Analysis: Further downside cannot be ruled out

EUR/USD trades in positive territory near 1.0862, adding 0.12% on the day.
The bearish outlook of the pair remains intact below the key EMA; RSI holds below the 50 midline.
1.0895 acts as an immediate resistance level for EUR/USD; the initial support level is seen at 1.0840.

Lallalit Srijandorn FXStreet

The EUR/USD pair trades on a stronger note during the early European session on Wednesday. The major pair has flirted with the weekly lows of 1.0821 and rebounded to 1.0862. However, the potential upside seems limited as investors turn cautious ahead of the European Central Bank's (ECB) interest rate decision on Thursday.

Ahead of the ECB key event, the preliminary Eurozone Purchasing Managers Index (PMI) will be due. The Composite PMI is expected to improve from 47.6 to 48.0 in January. The Manufacturing PMI is estimated to rise to 44.8, and the Services PMI is projected to grow to 49.0.

According to the four-hour chart, EUR/USD keeps the bearish vibe unchanged below the 50- and 100-period Exponential Moving Averages (EMA) with a downward slope. Furthermore, the Relative Strength Index (RSI) stands in bearish territory below the 50 midlines, suggesting that further decline looks favorable.

The 50-period EMA at 1.0895 acts as an immediate resistance level for the major pair. The crucial upside barrier will emerge at 1.0915, portraying the confluence of the upper boundary of the Bollinger Band and the 100-period EMA. The next hurdle is located near a high of January 15 at 1.0967, and finally at the 1.1000 psychological round figure.

On the other hand, the initial support level is seen near the lower limit of the Bollinger Band at 1.0840. The additional downside filter to watch is a low of January 23 at 1.0820. Further south, the next downside stop is located near a low of December 13 at 1.0773.

EUR/USD four-hour chart

(This story was corrected on January 24 at 07:35 GMT to say, in the second bullet point, that the pair trades below the key EMA, not above.)

EUR/USD

Overview
Today last price	1.0864
Today Daily Change	0.0014
Today Daily Change %	0.13
Today daily open	1.085

Trends
Daily SMA20	1.0949
Daily SMA50	1.0921
Daily SMA100	1.0772
Daily SMA200	1.0845

Levels
Previous Daily High	1.0916
Previous Daily Low	1.0822
Previous Weekly High	1.0967
Previous Weekly Low	1.0844
Previous Monthly High	1.114
Previous Monthly Low	1.0724
Daily Fibonacci 38.2%	1.0858
Daily Fibonacci 61.8%	1.088
Daily Pivot Point S1	1.0809
Daily Pivot Point S2	1.0768
Daily Pivot Point S3	1.0714
Daily Pivot Point R1	1.0903
Daily Pivot Point R2	1.0957
Daily Pivot Point R3	1.0998

Author

Lallalit Srijandorn

FXStreet

Lallalit Srijandorn is a Parisian at heart. She has lived in France since 2019 and now becomes a digital entrepreneur based in Paris and Bangkok.

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