EUR/USD: Will the bearish trendline be broken?

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During the first half of Tuesday, the EUR/USD exchange rate maintained stability around 1.0550, showing a narrow range. Buyers continued to exert upward pressure, capitalizing on the persistent weakness of the US dollar. Additionally, positive data from Germany supported the euro, with the German ZEW Survey for October indicating an improvement in Economic Sentiment beyond forecasts. The index recorded -1.1 for Germany and 2.3 for the Euro Zone. The assessment of the current situation turned out to be -79.9, slightly lower than the previous -79.4 but better than the market's anticipated -80.5.

Meanwhile, financial markets remained cautious due to developments in the Middle East. US President Joe Biden planned a visit to Israel to seek a diplomatic solution to the escalating conflict between the country and the Palestinian group Hamas, contributing to an atmosphere of caution. However, tensions escalated, leading to a humanitarian crisis in Gaza and the looming threat of an imminent Israeli ground incursion.

Ahead of Wall Street's opening, the US released the September Retail Sales report, showing an unexpected 0.7% MoM increase, surpassing the expected 0.3%. Later in the American session, data on September Industrial Production, Capacity Utilization, and August Business Inventories were released. Statements from Federal Reserve (Fed) Governor Michelle Bowman were also anticipated, known for her hawkish stance, suggesting the possible need for further interest rate hikes to curb inflation. Additionally, a strong bearish trendline on the H4 chart is noted, which could lead the price to re-enter the demand zone at the 1.056 level before continuing towards 1.0620. Let me know what you think, comment, and leave a like. Greetings from Nicola, the CEO of Forex48 Trading Academy.