Another terrible week ended with the debt crisis spreading across the continent. We’re now expecting a very busy of economic indicators, in addition to the non stop news. Here’s an outlook for the European events and an updated technical analysis for EUR/USD, now at much lower ground. EUR/USD daily chart with support and resistance lines marked. Click to enlarge: At the beginning of the week, the Irish crisis seemed like it’s going to have a happy end. Yet the tables turned quickly and contagion is the name of the game. It’s important to follow Spanish 10 year yields for signs of trouble. And there’s a rate decision and more events. Let’s start: German Unemployment Change: Tuesday, 8:55. Europe’s powerhouse has seen 8 straight months of drops in unemployment, showing the country’s economic strength. Following a small drop of 3,000 unemployed people last month, a bigger 18K drop is due now. Unemployment Rate: Tuesday, 10:00. The Euro zone’s high unemployment rate weighs on the Euro all year long. The high 10.1% rate is predicted to remain unchanged for another month. The troubled countries suffer from a higher unemployment rate: Spain has 20% and Ireland around 14%. CPI Flash Estimate: Tuesday, 10:00. Inflation is slowly picking up in the Euro-zone, although it still doesn’t push for a rate hike. The early estimation stood on an annual rate of 1.9%, and this will probably be confirmed now. Jean-Claude Trichet talks: Tuesday, 15:30 and Friday, 7:30. The president of the ECB will testify in the European parliament and will definitely relate to the ongoing debt issues in the continent. Any tough questions will trigger answers that may rock the Euro. His second appearance is in a conference. Though less important, he may release interesting statements following the rate decision. German Retail Sales: Wednesday, 7:00. The volume of sales unexpectedly fell last month. Europe’s largest economy is now expected to correct with growth of 1.3% in sales. Final Manufacturing PMI: Wednesday, 9:00. Manufacturing in the old continent is quite alright according to the initial release – 55.5 points. This will probably be confirmed now. PPI: Thursday, 10:00. Similar to consumer prices, producer prices are also slowly picking up. PPI is expected to print a rise of 0.4% after 0.3% last month. Rate decision: Thursday, 12:45. Jean-Claude Trichet doesn’t have too many options. The debt crisis that is raging in the continent means that the ECB will leave the interest rate unchanged for another month, at 1%. His words at the press conference 45 minutes later, especially about the crisis, are likely to rock the markets. Final Services PMI: Friday, 9:00. Also the services sector is OK according to the initial publication – 55.2 points, above the critical 50 point mark that is the pivot line between expansion and contraction. Retail Sales: Friday, 10:00. Despite being published after Germany and France, the figure for the whole continent still surprises. After a drop of 0.2% last month, a rise of 0.4% is due now. EUR/USD Technical Analysis Euro/Dollar leaned on 1.3530, but only for a short time, before making a sharp drop under 1.3440. After struggling with the 1.3334 line (mentioned last week), it further collapsed and closed at 1.3228, a weekly loss of nearly 450 pips! EUR/USD is now supported by 1.32, which cushioned the fall just now. Below, 1.3114 was a support line during April and also in August. The round number of 1.30 is another minor support line on the way down. Below, 1.2920 capped th pair during August and September, and is the next strong support. It’s followed by 1.2722 which capped the pair when it was recovering and finally by 1.2587, the lowest level in 5 months. Looking up, 1.3267 is a minor resistance line, followed by 1.3334 line – the peak in August which proved to be very pivotal in the past week. 1.3440 is already a strong line on the upside after it provided support in recent weeks. 1.3530 is a minor line on the way up, followed by 1.3637 and 1.37. Stronger resistance appears at 1.3830, which worked in both directions. The last line for now is 1.3950, which was a pivotal line while the pair was trading in a high range. I remain bearish on EUR/USD. We might have another good start to the week, if an aid package is indeed announced for Ireland, but the debt crisis is far from over. This can be seen in the rising yield on Spanish bonds – there’s still more room for falls. Another exciting week is due. This pair receives excellent reviews on the web. Here are my picks: Kathy Lien shows how Irish debt is exposed between different countries. John Rivera explains why the Euro remains vulnerable. James Chen reflects the big drop in his strength / weakness meter. Andriy posts weekly technical lines and trends for EUR/USD. Jamie Coleman wraps the week and sees enduring dollar demand. TheGeekKnows writes a review of the past week looks forward. Further reading on Forex Crunch: For a broad view of all the week’s major events worldwide, read the USD outlook. For the Japanese yen, read the USD/JPY forecast. For GBP/USD (cable), look into the British Pound forecast. For the Australian dollar (Aussie), check out the AUD to USD forecast. For the New Zealand dollar (kiwi), read the NZD forecast. For USD/CAD (loonie), check out the Canadian dollar. Want to see what other traders are doing in real accounts? Check out Currensee. It’s free.. Yohay Elam Yohay Elam Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts. Yohay's Google Profile View All Post By Yohay Elam EUR/USD Forecast share Read Next EUR/USD Risk Events During the Weekend Yohay Elam 12 years Another terrible week ended with the debt crisis spreading across the continent. We're now expecting a very busy of economic indicators, in addition to the non stop news. Here's an outlook for the European events and an updated technical analysis for EUR/USD, now at much lower ground. EUR/USD daily chart with support and resistance lines marked. Click to enlarge: At the beginning of the week, the Irish crisis seemed like it's going to have a happy end. Yet the tables turned quickly and contagion is the name of the game. 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