On Wednesday, the EUR/USD pair continued to decline, stopping only near the 161.8% Fibonacci retracement level at 1.0734. A rebound from this level allowed the pair to recover to the support zone of 1.0781–1.0797, but another rebound from this area opens the door for a renewed decline with a potential close below 1.0734. Conversely, a consolidation above the 1.0781–1.0797 zone would suggest the possibility of further euro growth toward the 200.0% retracement level at 1.0857.

The wave situation on the hourly chart has evolved. The last completed upward wave barely broke the previous peak, while the most recent downward wave broke the previous low. This indicates a gradual trend reversal toward a bearish direction. For several weeks, Donald Trump's tariffs exerted strong pressure on the dollar, but the market has now shown only a weak reaction to the latest round of tariffs.

Wednesday's news backdrop was both interesting and important. The U.S. durable goods orders report showed a 0.9% increase, beating the -1% forecast. Orders excluding transportation rose 0.7% (vs. 0.2% expected), and orders excluding defense climbed 0.8% (vs. -1.6% expected). These three key reports provided strong support for the bears. It was also announced yesterday that Trump imposed a 25% tariff on all automobiles imported into the U.S. Whereas previously such news would have triggered a sharp sell-off in the dollar, the reaction this time was minimal. This suggests the market may be growing desensitized to this factor. Of course, further tariffs are expected to be announced in early April, and their severity could again weigh on the dollar. But for now, this topic may be considered priced in.

On the 4-hour chart, the pair reversed in favor of the U.S. dollar after forming another bearish divergence and consolidating below the 61.8% Fibonacci level at 1.0818. Therefore, further decline toward the 50.0% level at 1.0696 remains possible. There's still room for downside, as the price is trading above the ascending trend channel. No fresh divergences are currently forming on any indicators.

Commitments of Traders (COT) Report:

During the latest reporting week, professional traders opened 305 new long positions and closed 46,030 short ones. The sentiment among the "Non-commercial" group turned bullish again—thanks to Donald Trump. The total number of long positions held by speculators now stands at 189,000, compared to 129,000 short positions.

For 20 weeks, large players had been offloading the euro, but for the past 6 weeks, they have been shedding shorts and building up longs. The divergence in monetary policy approaches between the ECB and the Fed still favors the U.S. dollar due to widening interest rate differentials, but Trump's trade policy is a more influential factor for traders, potentially pressuring the Fed toward a more dovish stance and even triggering a U.S. recession.

Economic Calendar for the U.S. and the Eurozone:

• U.S. – Final Q4 GDP (12:30 UTC)
• U.S. – Initial Jobless Claims (12:30 UTC)
• Eurozone – ECB President Christine Lagarde Speech (18:05 UTC)

The March 27 economic calendar includes three key events, two of which are quite significant. News flow may have a notable impact on market sentiment in the second half of the day.

EUR/USD Forecast and Trader Tips:

Selling opportunities were available after the pair closed below the 1.0781–1.0797 zone, targeting 1.0734 and 1.0622. The first target has been reached. Today, selling from a rebound from the 1.0781–1.0797 zone remains a valid strategy with the same targets. Buying can be considered only if the pair closes above this zone on the hourly chart, aiming for 1.0857—but bears are currently in control.

Fibonacci levels are plotted from 1.0529 to 1.0213 on the hourly chart and from 1.1214 to 1.0179 on the 4-hour chart.