Rate rallies hard, some sympathy trade from GBP; lows likely in finally from last week. Bids are supporting on dips. Bounce out of the drop on better volume traders say, lots of stops from shorts seen overnight as well as panic bids. Two-way trade and whipsaw result in increased volatility. Stops Friday suggesting bottom-picking is still being tried by early longs.

Traders report offers in size being absorbed. Traders suggesting that the rate is trading technically. Market is continues heavily short now so expect a further leg higher. Rate continues to track Cable and vice-versa. Now that more stops are cleared a rotation higher is even more likely. US data this week likely to be unfriendly so be ready for more whipsaw.

EURO/USD Daily

Resistance 3:  1.4550
Resistance 2:  1.4380
Resistance 1:  1.4250
Latest New York:  1.4293
Support 1:  1.4080
Support 2:  1.4000/10
Support 3:  1.3940/50
 
Data due Tuesday: All times EASTERN (-4 GMT)

2:00am EUR German Final CPI m/m
5:00am EUR CPI y/y
5:00am EUR ZEW Economic Sentiment
5:00am EUR Core CPI y/y
5:00am EUR German ZEW Economic Sentiment

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