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EUR/USD was unable to break above 1.20 after the disappointing Non-Farm Payrolls report from the US on Friday. What cannot go up, probably must come down.

The pair is now slipping under the very round 1.20 level which it held onto so nicely last week. The low so far is 1.1985. Support awaits at 1.1910, followed by 1.1860. Resistance above 1.20 remains at the 2017 peak of 1.2090.

The main driver is the extended recovery of the US dollar. Apart from the minor miss on the headline NFP number, the report wasn’t that surprising. In addition, the greenback has been under pressure for some time, and now the tides have turned.

The greenback is gaining ground another other currencies, with moves between 0.20% to 0.40% across the board.

In addition, the euro has its own data, and the first piece of news coming out of Europe in the first full week of 2018 hasn’t been great. German factory orders dropped by 0.4%, worse than a small increase of 0.1% that was expected.

Later on, we will get the Sentix Investor Confidence and the retail sales report for the euro area.

Will EUR/USD continue falling? A lot depends on the ECB meeting minutes released on Thursday. Some members want the Frankfurt-based institution to pre-announce the end of bond-buying after the current scheme ends in September. Yet Draghi wants to keep the pressure on, as inflation remains low.

More:  EUR/USD: Is Rally Nearing An End? – Credit Agricole