The Euro is under pressure against the U.S. Dollar on Tuesday, but clawing back from a three-week low hit earlier in the session. The single-currency is feeling pressure from a stronger U.S. Dollar, which is catching a bid because of firmer U.S. Treasury yields on reduced chances of a Fed rate cut in late July and general uncertainty ahead of Fed Chair Jerome Powell’s testimony before Congress on Wednesday and Thursday.

At 12:38 GMT, the EUR/USD is trading 1.1208, down 0.0006 or -0.05%. Earlier in the session, the Forex pair reached 1.1193, its lowest level since June 19.

The Euro is also weakening because the nomination of IMF Chairwoman Christine Lagarde could be a sign the European Central Bank is preparing to release a massive amount of stimulus in September.

Daily Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of the rally-killing closing price reversal top at 1.1413 on June 25.

A trade through 1.1181 will change the main trend to down. This could lead to a test of main bottoms at 1.1116 and 1.1107. A move through 1.1413 will negate the reversal top and signal a resumption of the uptrend.

The EUR/USD is also in a position to test a major, long-term Fibonacci level at 1.1185. This will also be a sign of increasing selling pressure.

Daily Technical Forecast

Based on the early price action and the current price at 1.1208, the direction of the EUR/USD is likely to be determined by trader reaction to the downtrending Gann angle at 1.1213.

Bearish Scenario

A sustained move under 1.1213 will indicate the presence of sellers. The next downside targets are an uptrending Gann angle at 1.1190, a Fibonacci level at 1.1185 and the main bottom at 1.1181. The latter is a potential trigger point for an acceleration to the downside with the next target angle coming in at 1.1150. This is the last potential support angle before the pair of bottoms at 1.1116 and 1.1107.

Bullish Scenario

A sustained move over 1.1213 will signal the presence of buyers. This will also put the EUR/USD in a position to post a dramatic closing price reversal bottom. If confirmed, this could lead to a 2 to 3 day rally. There is room to the upside with the nearest resistance coming in at 1.1270.