Rate two-way despite sharp fall in GBP; likely cross spreaders supporting on the dip as active sellers attempt to push the rate lower into major support around the 1.2780 area. Bottom may be forming around under the 1.3030 area as the drop into the 1.2900 handle was on thin volume.
50 bar MA failed now likely to offer resistance and a close above suggests the bottom will be in. Sell signal from the toolbox validated by the drop but be cautious as trend line support approaching. Semi-official and sovereign bids and offers seen overnight.
Technical levels around the 1.3300 area now likely to offer resistance so expect two-way action and consolidation. Look for a solid bounce from here. Aggressive traders can look to buy the next dip.
EUR USD Daily
-Resistance 3:1.3200/10
-Resistance 2:1.3180
-Resistance 1:1.3100/10
-Latest New York: 1.2886
-Support 1:1.2850
-Support 2:1.2800/10
-Support 3:1.2780
Data due Wednesday: All times EASTERN (-5 GMT)
-2:00am EUR German PPI m/m
-3:00am EUR ECB President Trichet Speaks
-4:00am EUR Italian Trade Balance
-4:30am EUR ECB President Trichet Speaks
Forex Analysis by Jason Alan Jankovsky at ForexPros.com. For more details about Forex Trading and Tips for decent earnings through Forex Trading, Please check http://www.forexpros.com