EUR/USD Price Analysis: Further declines cannot be ruled out

• EUR/USD is trading in positive territory near 1.0865, adding more than 0.10% on the day.
• The pair's bearish outlook remains intact above the key EMA; the RSI remains below the midline of 50.
• EUR/USD finds resistance at 1.0895, while the initial support level is at 1.0840.

The pair EUR/USD moves higher during the early hours of the European session on Wednesday. The pair has flirted with the weekly lows of 1.0821 and has bounced up to the 1.0865 region. However, upside potential appears limitedas investors remain cautious ahead of the European Central Bank's (ECB) interest rate decision on Thursday.

Before the key ECB meeting, the Preliminary Eurozone Purchasing Managers' Index (PMI). The composite PMI is expected to improve from 47.6 to 48.0 in January. The manufacturing PMI is estimated to rise to 44.8, and the services PMI is estimated to grow to 49.0.

On the 4-hour chart, EUR/USD maintains the bearish wave below the downward-sloping 50 and 100 EMAs. Furthermore, the Relative Strength Index (RSI) is in bearish territory below the midline of 50, suggesting that a further decline seems favorable.

The 50 period EMA in 1.0895 It acts as an immediate resistance level for the pair. The main bullish barrier is found in 1.0915, where the upper limit of the Bollinger Bands and the 100 period EMA converge. The next hurdle is near the January 15 high in 1.0967 and, finally, at the round psychological level of 1.1000.

On the other hand, the initial support level is observed near the lower limit of the Bollinger Bands in 1.0840. The additional bearish filter to watch is the January 23 low in 1.0820. Further down, the next support is near the December 13 low in 1.0773.

EUR/USD 4-hour chart