EUR/USD Price Analysis: Euro recovers within nearby triangle below 1.1000 amid looming Italy tax woes

• EUR/USD prints the first daily gains in three within two-month-old symmetrical triangle.
• China-linked data, news favored Euro pair’s corrective as US Dollar braces for inflation data.
• Upbeat RSI (14) line may help EUR/USD to extend recent rebound bears remain hopeful below 200-SMA.

EUR/USD consolidates weekly losses amid Wednesday’s sluggish morning in Europe. In doing so, the Euro pair licks its wounds within a two-month-old symmetrical triangle as market sentiment improves a bit on news and data surrounding China.

That said, the improvement in China’s factory-gate inflation supersedes the downbeat consumer price increase to underpin recent stabilization in the market. Further, the latest risk-positive news from the Biden Administration, cited by Bloomberg, also allows the EUR/USD traders to lick their wounds. “The US plans to target only those Chinese companies that get more than 50% of revenue from the sectors including quantum computing and artificial intelligence (AI),” said the news.

It’s worth noting that the pessimism emanating from Italy’s surprise tax on windfall profits of banks joined the global rating agencies’ downward revision of the US banks and financial institutions to weigh on the risk sentiment and the EUR/USD price. On the same line could be fears of the UK recession and slowing economic growth in China.

Technically, the Euro pair’s rebound from the bottom line of the aforementioned triangle joins the upbeat RSI (14) line, not overbought, to defend the EUR/USD bulls.

However, the stated triangle’s top line around the 1.1000 psychological magnet precedes the 200-SMA hurdle of around 1.1020 to restrict the short-term EUR/USD upside.

Meanwhile, a downside break of the triangle’s support line, close to 1.0930 by the press time, can amplify the bearish bias about the Europe pair and drag it towards the previous monthly low of around 1.0830.

Though, the August 03 trough surrounding 1.0910 and the 1.0900 may prod the EUR/USD bears.

EUR/USD: Four-hour chart

Trend: Bearish