EUR/USD Price Analysis: Remains subdued near 1.0500 within a rising wedge pattern

• EUR/USD could lose ground amid a potential bearish reversal as the pair trading within a rising wedge pattern.
• The downward correction would be indicated if the 14-day RSI surpasses the 70 mark.
• The pair may test its primary support level at the nine-day EMA of 1.0453.

The EUR/USD pair edges lower after gaining some good profits in the previous session, trading around 1.0500 during the Asian session on Friday. A closer examination of the daily chart indicates a potential bearish reversal as the pair trading within a rising wedge pattern, indicating the declining volume as the pattern develops, signaling weakening buying pressure for the pair.

However, the 14-day Relative Strength Index (RSI), a key momentum indicator, is hovering near 60, indicating continued bullish support for the EUR/USD pair. A move beyond the 70 level would signal overbought conditions, potentially leading to a downward correction. Additionally, the pair remains above both the nine-day and 14-day Exponential Moving Averages (EMAs), reinforcing strong short-term momentum.

On the upside, the EUR/USD pair could face initial resistance at the upper boundary of the rising wedge at 1.0540. A breakout above the wedge would reinforce the bullish bias and support the pair to test the two-month high of 1.0630, reached on December 6.

The EUR/USD pair is expected to test its key support level at the nine-day EMA of 1.0453, followed by the 14-day EMA at 1.0436, which aligns with the lower boundary of the rising wedge. A decisive break below this crucial support zone could trigger a bearish bias, increasing downward pressure on the pair and potentially driving it toward the 1.0177 level—the lowest since November 2022, last recorded on January 1.

EUR/USD: Daily Chart