On March 30, Germany's Federal Statistical Office released data indicating that consumer prices rose by 2.8% year-on-year in March, a significant acceleration from February's 2.0% and reaching a more than one-year high, aligning with the median forecast in Bloomberg surveys. Energy costs surged by 7.2% year-on-year, marking the first positive growth since December 2023, amid concerns that the geopolitical situation in the Middle East could trigger a repeat of the 2022 inflation crisis. European Central Bank (ECB) President Lagarde has stated that the bank is prepared to act decisively and swiftly if necessary, with readiness to intervene at any meeting, including the upcoming one next month. However, officials also emphasized a deliberate approach, ensuring a comprehensive assessment of the war's far-reaching implications. Both corporate and consumer signals point to a rising inflation outlook. A survey by the Ifo Institute on Monday revealed a substantial increase in the number of German companies planning price hikes, suggesting some businesses do not anticipate a swift resolution to energy-related challenges. Concurrently, another survey by the European Commission indicated that Eurozone consumer inflation expectations have climbed to their highest level since 2022. Money market pricing reflects investor expectations that the ECB will not lag behind this time, with bets on a potential rate cut as early as April and an anticipated total of three cuts throughout the year.

In the 1D timeframe, EURUSD exhibits a downward-opening Bollinger Band formation and diverging moving averages, indicating the overall downtrend remains intact. While the MACD shows a reduction in bearish momentum and a death cross between the MACD line and signal line has reoccurred, the candlestick pattern suggests the potential for a doji, which could lead to a rebound towards the EMA50 and the middle Bollinger Band, located around 1.164 and 1.159 respectively. The RSI is at 38, reflecting market pessimism. In the 4H timeframe, the Bollinger Band is also downward-opening with diverging moving averages. The price is oscillating between the lower Bollinger Band and the EMA12, trending downwards. However, the MACD is nearing a golden cross, signaling a potential rebound. The RSI is at 34, indicating market pessimism. Provided that a new low is not established in the short term, the trend is likely to shift from bearish to bullish. The recommended strategy is to buy on dips.

Trading Direction: Buy

Entry Price: 1.147

Target Price: 1.18

Stop Loss: 1.13

Support: 1.145, 1.14, 1.13

Resistance: 1.17, 1.18, 1.21