Fundamental analysis of EUR/USD

Against the backdrop of fluctuating market sentiment, the EUR/USD pair demonstrated restrained volatility on Wednesday, hovering around the key psychological level of 1.07000 during Asian trading hours. 
The US dollar has struggled to recover since late September, despite a sharp drop in US bond yields and rising US stock markets, which supported the euro against the dollar. However, investors continued to take a cautious stance as uncertainty remained over the US Federal Reserve's future interest rate adjustment bias. Last week, the Fed suggested that current monetary conditions may be sufficient to contain inflation, leading traders to speculate that the rate tightening cycle may be nearing an end. This was supported by weak US jobs data, which signaled a pause in policy adjustments in December. However, hawkish comments from various Fed officials recognizing the resilience of the US economy have renewed expectations of further rate hikes, providing potential support for the US dollar. 
Ahead of Fed Chairman Jerome Powell's next speech, market participants remained cautious, while a larger-than-expected decline in German industrial production in September put pressure on the euro. An additional hurdle for the euro is that the European Central Bank is expected to suspend interest rate hikes, suggesting that a downtrend in the currency pair is inevitable. An expected drop in retail sales in the eurozone is adding to fears of an impending recession, while potentially reducing inflationary pressures and keeping conditions for interest rates to remain high.
Speeches by ECB chief economist Philip Lane and board member Andrea Enria will also be scrutinized for future policy guidance. At the same time, comments from Fed Chairman Jerome Powell and other FOMC members will provide further insight into the US interest rate environment. 
The interaction between central bank announcements and the dynamics of economic indicators will determine the short-term direction of the EUR/USD pair, and the deteriorating situation in the Eurozone economy may incline the ECB to a softer stance than the Fed.  Now all eyes are on the Eurozone retail sales, which, along with Powell's speech, are expected to provide clues to the near-term direction of the EUR/USD pair. 
Technical analysis and scenarios:

A price decline in the lower Bollinger Bands range with the indicator pointing upwards indicates the possibility of a reversal if price breaks the lower band support at 1.06400. A narrowing of the price range could lead to a breakout. Stochastic Oscillator with a value of 48.1366 and a signal of 53.0225 Stochastic Oscillator indicates that the asset is neither overbought nor oversold. The fact that the value is below the signal may indicate a slight bearish momentum. The MACD value is very close to its signal line, but slightly below it (0.001386 < 0.002426). This indicates a weak bearish momentum and may indicate that the price may consolidate or reverse in case of bullish pressure.
Main scenario (SELL)
Recommended entry level: 1.06600.
Take Profit: 1.06080.
Stop loss: 1.06800.
Alternative scenario (BUY)
Recommended entry level: 1.06970.
Take Profit: 1.07380.
Stop loss: 1.06800.