New lows on light volume during the day, unable to extend losses. Stops on the way down at 1.4750 on Russian sales, support solid in my view at 1.4700 area; look for late shorts to bail on a move back over the 1.4780 area this week. Likely rolling stops lower to the 1.4800/20 area in size.

Grind in two-way action is good but we want higher volumes on rallies to form this bottom. Some whipsaw possible but unable to make new lows so far this week. Traders report large bids on the drop but volumes died later. Traders suggesting that the rate is vulnerable to a short squeeze. Market is heavily short now so expect a rally.

Larger names buying last week traders say. Likely the rate has flushed all longs. Aggressive traders can continue buying this dip for a return to resistance. Rate continues to track Cable and vice-versa. Now that stops are cleared a rotation higher is coming.

US data this week likely to be unfriendly so be ready for whipsaw.

EURO/USD Daily

Resistance 3:  1.4840/50
Resistance 2:  1.4800/10
Resistance 1:  1.4780
Latest New York:  1.4745
Support 1:  1.4670/80
Support 2:  1.4650
Support 3:  1.4620/30

Data due Thursday: All times EASTERN (-5 GMT)

3:00am EUR French Flash Manufacturing PMI
3:00am EUR French Flash Services PMI
3:30am EUR German Flash Manufacturing PMI
3:30am EUR German Flash Services PMI
4:00am EUR Flash Manufacturing PMI
4:00am EUR Flash Services PMI

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