Early in another week of March, EUR/USD remains under pressure; the asset is currently trading at 1.0915. Market players still like “the greenback” – the demand for "safe haven" assets is still quite high amid a controversial risk attitude. This week is going to be very important for the currency market: on 15 and 16 March, the American regulator is scheduled to have a crucial meeting where it is expected to raise the key benchmark interest rate by 25 basis points, from 0-0.25% to 0.25-0.50. However, there is a more aggressive scenario, which implies a 50 point hike but it is rather unlikely.
The major problem for the US is increasing inflation – the Consumer Price Index was 7.9% y/y, which is the highest reading in 40 years. The US Fed should have raised the rate earlier, but more active steps in tightening its monetary policy are expected to help the regulator to take control over the CPI.
In the H4 chart, EUR/USD continues forming the first ascending wave; right now, it is correcting. The asset has already reached 1.0900 and is currently consolidating above it. Possibly, the pair may expand the range down to 1.0885 and then for one more ascending wave the first target at 1.1162. Later, the market may start a new correction towards 1.0990. From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is falling and may later grow to reach 0. After breaking this level, it is expected to continue moving towards a new high.
As we can see in the H1 chart, after forming a new consolidation range around 1.1000 and breaking it to the downside, EUR/USD is expected to form a new descending impulse and complete this wave at 1.0885. Later, the market may form a new consolidation range near the lows and then start another wave to the upside to reach 1.1025 or even break it. In this case, the asset may continue trading upwards with the target at 1.1122. From the technical point of view, this idea is confirmed by the Stochastic Oscillator: its signal line is moving below 50 and may continue falling to reach 20. Later, the line may rebound from 20 and start a new growth towards 80.