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EUR/USD failed to break above resistance and took a dive – this sent it below uptrend support. Will we see an accelerated fall?  Here’s a quick update on technicals, fundamentals and community trends.

EUR/USD Technicals

  • Asian session:  struggled  around 1.37..
  • Current range – 1.37 to 1.3830
Euro/Dollar Chart January 27
Euro/Dollar Chart January 27 - Click to enlarge
  • Further levels in both directions: Below   1.37, 1.3576, 1.3440, 1.3334, 1.3267, 1.3180, 1.3080, 1.2970, 1.2920,  1.28, 1.2722, 1.2587.
  • Above      1.3830,  1.3950, 1.4030 and 1.4220.
  • Uptrend support is naturally ascending, 1.3680 at the time of writing, and can cushion a fall.
  • 1.37 is a critical line of struggle during recent days.
  • 1.3440 is the key  downside  level – it has stopped the Euro so many times in the past.

Euro/Dollar loses uptrend support  – click on the graph to enlarge.

EUR/USD Fundamentals –

  • German CPI. Exp. -0.3%. Released throughout the day.
  • 13:30 US Unemployment Claims. Exp. 407K.
  • 13:30 US Durable Goods Orders. Exp. 1.6%. Core figure exp. +0.9%.
  • 15:00 US Pending Home Sales. Exp. +0.9%.

* All times are GMT.

For more events later in the week, see the EUR/USD forecast.

EUR/USD Sentiment

  • S&P downgrades Japan’s credit rating from AA to AA-. No country is immune to debt. What does that mean for Europe – the charts provide an answer.
  • Ben Bernanke made no significant changes in the FOMC Statement, turning it into a non-event.
  • Spain’s program to shore up the troubled savings banks (cajas) is doubted by some analysts – this looks like the situation in Ireland one year ago. Spanish yields are 5.45%- rising throughout the week.
  • British contraction in Q4 weighs on the Euro.
  • The Irish parliament is ratifying the finance bill, despite protest.
  • Inflation is becoming problematic for Europe. This comes as employment is still high. Double trouble for Europe. Trichet showed concerns about inflation and boosted the Euro. Will German CPI push the Euro higher?

Currensee Community: 63% are long , 37% are short. These are 1359 open positions in real accounts trading this pair at the moment.