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The ongoing speculation about the next move of the ECB is taking its toll on the common currency. In a move unrelated to the US dollar’s trading against other currencies, EUR/USD is falling. The less than impressive money supply and loan figures certainly did not help.

The pair extended earlier falls and is now trading below the double bottom line that was formed after recent ECB remarks.

Here is how the dip looks on the 30 minute chart. Note the double bottom line at 1.3750:

EURUSD March 27 2014 under double bottom following weak money supply in the euro zone

Support lies at 1.3650 if this break is confirmed. Resistance awaits at 1.38. For more on the euro, see the  euro to dollar forecast.

Euro-zone M3 money supply accelerated to 1.3% as expected in February. This is stronger than 1.2% seen beforehand but still reflects a very weak economy. In addition, the level of private loans fell by 2.2% year over year, worse than 2.1% in the previous month.

Draghi may claim that the credit crunch is related to the banks’ stress tests, but the problem seems deeper.

Will the ECB act in a week from now?

See how to trade the US pending home sales with EUR/USD.