EURUSD bears are pausing before the ECB policy announcement.

The Euro remains firmly entrenched in negative territory, hovering near last week’s low at 1.0725, after experiencing a significant decline on Wednesday, with the pair down by 1%.

The unexpected surge in US inflation during March tempered market expectations for the Fed’s anticipated rate cut in June, thereby bolstering the US dollar against its major counterparts.

Attention now shifts to the upcoming ECB policy decision scheduled for later today. The central bank is widely anticipated to maintain unchanged rates, while market participants eagerly await the ECB’s forward guidance, hoping for insights into the timing of potential monetary policy adjustments.

Daily analyses indicate a strong bearish sentiment, maintaining a pessimistic outlook in the near term. A breach of the critical support zone at 1.0725/1.0695 (comprising the April 2 low, Fibonacci 61.8% level of the 1.0448/1.1139 range, psychological support, and February 14 low) would signify a continuation of the broader downtrend initiated from the peak at 1.1139 on December 28.

The broken Fibonacci 76.4% level at 1.0762 has transformed into initial resistance. Any upward movements are expected to encounter resistance from the 10-day moving average (1.0800), reinforcing the dominance of the larger bearish trend and providing optimal selling opportunities