Rate follows GBP higher but still lower on the day despite new highs in New York at 1.3004 at writing; drop is less volatile and the rate holds tech support at 1.2850/60 area. Rally all day today suggests a short-squeeze is in the works.

Stops baked on the dip under 1.2880 again overnight; stops increasingly likely around 1.3030 area and layered above. Bulls are attempting to find a bottom. Bottom may be forming around the 1.2850 area as it has bounced three-times from there. 50 bar MA failed now likely to offer resistance and a close above suggests the bottom will be in.

Close over 1.3000 to end the day today will be seen as positive for a rally. Semi-official and sovereign bids and offers seen last week. Technical levels around the 1.3300 area now likely to offer resistance so expect two-way action and consolidation. Aggressive traders can look to buy the next dip.

EUR USD Daily
Resistance 3:  1.3150
Resistance 2:  1.3100/10
Resistance 1:  1.3030
Latest New York:  1.2986
Support 1:  1.2850/60
Support 2:  1.2800/10
Support 3:  1.2750/60

Data due Tuesday: All times EASTERN (-5 GMT)
2:00am EUR German Import Prices m/m
4:00am EUR German Ifo Business Climate
4:00am EUR Current Account

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