As it was forecast, the EUR/USD reached the resistance levels at 1.1060. The event was followed by a decline down to the 55-hour simple moving average at 1.1040.
In general, the pair was set to be supported by the 55 and 100-hour SMAs and face the resistance of the upper trend line of a channel down pattern near the already mentioned 1.1060 level.
No data on Tuesday
This week, there are couple events that could have an impact on the EUR/USD exchange rate.
On Wednesday, September 11, the US Producer Price Index data will be published at 12:30 GMT. Last release caused only a seven-pip move. However, this data release might cause a more significant market reaction.
On Thursday, September 12, the US Consumer Price Index data will be released at 12:30 GMT. Previous release caused a 23-pip move.
Meanwhile, on September 12, the ECB Monetary Policy Statement will be published at 11:45 GMT. On July 25, the event also caused a 23-pip move.
The week will end with the US Retail Sales release at 12:30 GMT on Friday, September 13. Last release caused almost a fifteen-pip move.
EUR/USD hourly chart's review
On Tuesday morning, the EUR/USD was located just above the support of the 55 and 100-hour simple moving averages near the 1.1040 level. Meanwhile, the rate faced the resistance of the upper trend line of a large descending channel pattern near 1.1060.In general, the rate is expected to get squeezed in between the described supports and resistance. Once it occurs, pressure should build and a break out would occur.
If the rate breaks out to the upside, the pivot point at 1.1069 would provide resistance.
On the other hand, a break out downwards would reach the combined support of the 200-hour SMA and a weekly pivot point near 1.1015.
Hourly Chart
On the daily candle chart, a new descending channel pattern has been added. It represents the rate's decline since June.
In general, the pattern is expected to provide resistance to the rate during the next couple of weeks.
Daily chart
Read More: Technical Analysis
Traders remain short
Since Friday, 58% of open EUR/USD position volume on the Swiss Foreign Exchange was in short positions.
The bearish sentiment slightly decreased on Tuesday, as 57% of volume was in shorts.
Meanwhile, pending trade orders were bearish, as 68% of orders in 100 pips range around the current rate were to sell and 32% were to buy.
Previously, 56% of orders were to sell.