On Monday EUR/USD extends the downside. The pair has retested the $1.3300 boundary, but then slipped lower into the $1.3250 area (76.4% Fibonacci).
Technically, the appreciation of the euro is contained by the 2013 trend resistance (currently around $1.3315). What’s more, the last week’s long-legged “doji” candle on the top of the uptrend speaks in favor of selling the euro, at least in the near term. Strong US non-manufacturing PMI released today also is a bearish sign.
We recommend going short on the pair at the current levels with an initial target of $1.3160 and then – $ 1.3085. Rise above $1.3350 could open the way to $1.3415, but $1.3340 remains a strong resistance for now.
Chart. Daily EUR/USD