The EUR/USD is still battling with March highs while jammed in the 1.30 zone. The Euro is enjoying relative strength against the Dollar and Pound after Germany's economic sentiment came in better than analyst expectations.

The EUR/GBP is breaking out to the upside in reaction to horrible economic data from Britain. However, we feel yesterday's consumer sentiment data may be a lagging indicator considering Germany showed production fell off a cliff last week.

Lower production and manufacturing implies rising unemployment and consequently reduced consumption. Hence, we caution against getting carried away with yesterday's consumer sentiment release. Meanwhile, the EUR/USD remains above our 3rd tier downtrend line and is building a solid trading base during its consolidation.

With a lack of significant economic data coming from the EU over the rest of the week, we expect a tight correlation with U. S. equities over the next couple sessions.

Meanwhile, if the EUR/USD can peak over February highs, we could see the currency pair dart towards a retest of 2009 highs.

Fundamentally, our 1.3022 resistance becomes support while we maintain our additional supports resting at 1.2991, 1.2934, and 1.2910.

To the topside, we maintain our resistances of 1.3058, 1.3086, and 1.3120 with fresh top-end hanging at 1.3147.

The EUR/USD is currently exchanging at 1.3039.

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