• A bearish megaphone formation accelerates the odds of a downside bias.
• The RSI (14) is attempting a downside break of 40.00, which will strengthen the greenback bulls.
• A bear cross, represented by the 20-and 50-period EMAs, adds to the downside filters.

The EUR/USD pair has turned sideways after a juggernaut rally from Wednesday’s low at around 1.0130. The asset is oscillating in a 1.0163-1.0172 range but is likely to behave volatile ahead. Also, the asset defended its weekly lows on Wednesday, which signals the availability of buying interest at lower levels.

On a four-hour scale, the asset is auctioning in a bearish megaphone chart pattern that indicates a volatility contraction but in a wider range. The upward sloping trendline of the above-mentioned chart pattern is placed from July 28 high at 1.0234 while the horizontal support is plotted from July 28 low at 1.0114.

A bear cross represented by 20-and 50-period Exponential Moving Averages (EMAs) at 1.0194 adds to the downside filters.

Also, the Relative Strength Index (RSI) (14) is oscillating in the 40.00-60.00 range. The momentum oscillator is attempting a break below 40.00, which will intensify the downside momentum.

A downside break of a two-week low at 1.0100 will drag the asset towards July 14 high and low at 1.0050 and 0.9952 respectively.

On the contrary, the shared currency bulls could defend the downside bias and send the asset towards July 1 low at 1.0366, followed by July 4 high at 1.0463, if the asset manages to overstep Tuesday’s high at 1.0294.

EUR/USD four-hour chart