EURUSD has formed lower highs and higher lows to consolidate inside a symmetrical triangle pattern on its hourly time frame. Price is testing the resistance but might wait for the ECB decision before picking a direction.

Technical indicators are looking mixed for now. The 100 SMA is below the 200 SMA to suggest that the path of least resistance is to the downside or that there’s a chance support around 1.0700 might break. If that happens, EURUSD could be in for a slide that’s the same height as the triangle.

Stochastic appears to be pulling higher from the oversold region, though, so bullish pressure might pick up from here. A break above the top around 1.0750 could be followed by a rally that’s the same size as the chart pattern or around 150 pips.

RSI is pointing lower, though, suggesting that sellers might have the upper hand for now.

The ECB is widely expected to keep rates on hold for the time being, but policymakers might also signal that a July hike is in order. This comes after several officials have already been hinting at tightening monetary policy and withdrawing stimulus in order to keep inflation in check.

However, ECB head Lagarde has been keen on keeping market expectations subdued in order to maximize the effect of a potential rate hike. Downplaying tightening hopes might mean some downside for the shared currency in the near-term.

There are no major reports due from the US economy, so EURUSD might take most of its cues from the ECB decision or any major swings in market sentiment. A pickup in risk aversion could still favor the safe-haven US dollar, especially if investors continue to stay wary of a potential recession due to spiking inflation.