The euro-dollar exchange rate (EUR/USD) is still trading in a lateral phase, but I do not find any concrete possibilities of breaking the psychological resistance at 1.10 and it could remain confined between 1.09 and 1.10 without any particular surprises, at least for the rest of the week.
Of the two opposing scenarios, the most likely in my opinion remains the bearish one. I consider this the most probable option not because there are already clouds on the horizon, but because the resistance at 1.10 can only be broken by a push provided by the respective central banks. In this context, the euro-dollar exchange rate could return to test intermediate supports such as that of 1.092 before breaking down below 1.09
And similarly, even in the event of a bullish rally, if the rise were to crash into the psychological resistance at 1.10 without breaking it, the resulting rebound could easily trigger the trend reversal.
Therefore, remaining in the bearish picture outlined so far, beyond the support at 1.09 I believe it is wise to pay attention to the intermediate level of 1.088 and then to the subsequent target of 1.085. Larger declines can be easily contained by these intermediate supports.
