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Early on Monday, EUR/USD retraced up, following its fall after the ECB meeting. However, in the course of the European session, a reversal occurred, and the euro tumbled against the greenback. The drop came amid a 2.1% slowdown in wage growth in the eurozone, following a downwardly revised 3.2% rise from 4.1%. Economists had expected figures to remain unchanged.
The reaction of the market to the data came as surprise. Indeed, the market usually pays little attention to this report. This fact illustrates that market participants generally bet on a stronger greenback. It is no wonder if we look at the outcomes of the ECB and FOMC meetings.
Eurozone Wage Growth:
Due to an empty macroeconomic calendar, the same market sentiment will drive the greenback further up today. Still, this is likely to be an insignificant rise in the dollar value.
A bearish correction from the peak of the uptrend slowed near 1.0580. The price then tarded sideways in the range between 1.0580 and 1.0660.
Moving along line 50 on the 4-hour chart, the RSI confirms the sideways trend. On the daily chart, the indicator is moving up between lines 50 and 70, illustrating the uptrend that emerged in the middle of autumn.
The Alligator's moving averages have multiple crossovers on the 4-hour chart, confirming a flat market. On the daily chart, the Alligator's MAs are headed upward.
Outlook
The sideways movement is terminal and may be an accumulation stage. Consequently, it would be wiser to follow a breakout trading strategy.
When it comes to complex indicator analysis, there is a mixed signal for short-term and intraday trading and a buy signal for medium-term trading.
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