EurUsd Mid term downtrend

With the mixed U.S. data in February, the EUR/USD pair began a technical correction rally. However, we anticipate a return to a downward movement, driven by the lack of a change in the FED's hawkish stance to tighten the market and the ECB's relatively more dovish signals, especially following the ECB press conference last week after the interest rate decision. While we expect four interest rate cuts of 25 basis points each from the FED this year, we anticipate more cuts from the ECB, particularly due to Germany entering a rapid period of disinflation.

Technically, on March 8th, the price encountered strong resistance from the intersection of both the downward and upward Fibonacci retracement levels. Overbought conditions based on RSI and the failure to surpass two significant resistance levels at 1.0970 signal a downward trend.

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The price has fallen to the 50% Fibonacci level of the recent upward movement without any correction. We are currently monitoring whether there will be a corrective rise in the price before initiating a new sell trade.

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The expected corrective rally occurred during the FOMC meeting. We are observing how the price will react at the 61.8% level for the continuation of the downtrend.

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Prior to the unemployment and inflation data to be released on Thursday and Friday, the market might be in a holding pattern. During this period, we are likely to see broad band lateral movements, and the main trend will swiftly continue after the Core PCE data is announced on Friday. Until Thursday, we might witness rises and lateral movements in the price.