EUR/USD consolidating at 4-month lows around 1.2900 (Barcelona) – Euro decline from 1.3430 high on December 31 extended at Asian session opening, with Eurozone debt concerns back on focus, and the pair hit a fresh 4-month low at 1.2860 to pick up moderately and consolidate between 1.2875 and 1.2920 during the European session.

Immediate support lies at 1.2860/70 (session lows), and below here, 1.2825 (Daily Pivot Point S2) and 1.2785 (Sept 13 low). On the upside, resistance levels lie at 1.2920/30 (session highs), and above here, 1.3020 (Jan 7 highs) and 1.3080 (200-day MA).

The overall bias remains strongly bearish, according to Nicole Elliott, technical analyst at Mizuho Corporate Bank, who expects the downtrend to extend over the near-term: ” Expect to see further slippage in the Euro against other currencies, keeping an eye on EUR/CHF which tests its record low at 1.2400. Here it will try and hols around current levels.”


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