The EUR/USD has flattened out this week, holding above 1.11 after a slide from just above 1.16.EUR/USD daily chart 6/1(click to enlarge)Critical Level - Central Pivot AreaThe daily chart shows that the slide has brought EUR/USD to a critical area.1) 1.11 is around the middle or central pivot area of the consolidation range that started early 2015. 2) There is a rising trendline3) We can see that 1.10-1.11 is also a support/resistance pivot, confirming the importance of the "central pivot" location. 4) Price is testing the 200-day SMAEssentially, whether or not EUR/USD holds above the 1.10-1.11 area will suggest whether it is turning bullish or remaining sideways, which is actually slightly bearish because the trend was bearish heading into 2015, before the year-long "accumulation period" that could turn out to be simply a consolidation before further decline. ECB Event Risk: The ECB will announce monetary policy tomorrow. While there is no expectation of change, all eyes/ears will be on the ECB conference later, lead by ECB president Mario Draghi. I think the main issue will be how the ECB views inflation risk after such a sharp rebound in oil prices. If Draghi puts the 2018 inflation expectation anywhere near 2%, the market might reach bullishly in the EUR/USD. It might be more bullish in the EUR/GBP because as the latest ISM Manufacturing PMI showed, the greenback has some bullish potential as well. EUR/USD 1H Chart 6/1(click to enlarge) I think from the way EUR/USD is set up right now, we will know more about whether it will be bullish than whether it will turn bearish. If after the ECB meeting, the EUR/USD can hold above 1.1140, we should see a bullish push towards 1.12 and possibly 1.1240 the rest of the week. However, a break below 1.140 opens up the 1.11 low. While this might maintain a short-term bearish outlook, EUR/USD will also be entering a critical area between 1.10 and 1.11. I would prefer more information before anticipating anything coming out of this scenario. On the other hand, if price shows it can hold above 1.1140, I would feel more comfortable trying to buy EUR/USD with a target of 1.1240, and at most 1.13 in the short-term.