• EUR/USD seesaws around three-week high amid pre-Fed anxiety.
• Overbought RSI, 200-EMA prods Euro bulls within two bullish channels.
• Euro bears need validation from 1.0700 and the FOMC to retake control.

EUR/USD treads water around 1.0800 as it struggles to extend the two-day winning streak near the highest levels since late May amid early Wednesday. In doing so, the Euro pair aptly portrays the market’s cautious mood ahead of the Federal Open Market Committee (FOMC) monetary policy meeting.

Also read: EUR/USD retreats from three-week high towards 1.0750 as Fed vs. ECB battle intensifies

That said, the 200-bar Exponential Moving Average (EMA), near 1.0800 by the press time, challenges the EUR/USD pair’s immediate upside amid the overbought RSI conditions. Also acting as an immediate upside filter is the top line of a one-week-old rising channel, close to 1.0820.

In a case where the Euro bulls keep the reins past 1.0820, a convergence of its 50% Fibonacci retracement of May-month downside and a fortnight-long bullish channel’s upper line, near 1.0865 at the latest, will be in the spotlight.

Should the EUR/USD manage to remain firmer past 1.0865, the odds of witnessing a gradual rise toward the 1.1000 psychological magnet can’t be ruled out.

Meanwhile, a rejection of the immediate bullish channel, by a downside break of the stated channel’s bottom line surrounding 1.0770, can convince intraday sellers of the EUR/USD pair. Following that, a quick fall to 1.0730 can’t be ruled out.

However, the bottom line of the broader ascending trend channel, close to the 1.0700 as we write, holds the key for the Euro bear’s conviction.

EUR/USD: Four-hour chart

Trend: Pullback expected