EUR/USD Maintains Bearish Tone above 1.0870

In the early European session on Tuesday, EUR/USD is trading around 1.0871, staying in negative territory. The pair is experiencing a cautious market sentiment, with traders holding back ahead of the Federal Reserve’s interest rate decision scheduled for Wednesday. Currently, EUR/USD is showing a slight decrease of 0.01%.

Technically, EUR/USD continues to exhibit a bearish outlook. It remains below the key 50- and 100-period Exponential Moving Averages (EMA) on the four-hour chart. The Relative Strength Index (RSI) is below the 50-midline, indicating favourable conditions for further downside movement.

The immediate downside target for the pair is around 1.0852, positioned near the lower boundary of the Bollinger Band. Below this level, the next significant support is at 1.0800, marked by a previous low and a psychological level. Further downward movement could lead to levels around 1.0761 and 1.0725.

On the upside, the initial resistance is anticipated at the 100-period EMA at 1.0882. For a bullish breakout, EUR/USD would need to surpass the 1.0900-1.0905 zone, which includes the 50-period EMA, a psychological level, and a previous high. A successful breach above this level could trigger a rally towards the upper boundary of the Bollinger Band at 1.0926, followed by higher levels around 1.0955.

EUR/USD four-hour chart 

EUR/USD