EUR/USD Outlook - Feb 9

Slower day for the EUR/USD on Monday. While the EUR did push above minor resistance at 1.3680 ultimately it has so far failed even to test the recent swing high at 1.3740 and currently trades at 1.3660.

The consolidation pattern which is currently visible on the short term time frames is traditionally a continuation pattern. Considering the strong trend, overall bias remains to the downside.

A drop below 1.3640 is likely to move into the 1.3620 region (this is more so the level to watch), with a drop below that level indicating a test of recent lows just below 1.3600. A break below the recent low has a target of 1.3485 with some support likely at 1.3540 and 1.3500-1.3485.

Resistance comes in at 1.3680 and then at Monday's high 1.3700-1.3715. Beyond this, 1.3740-1.3750 is resistance. If the EUR can push above that level, there is a possibility that a larger upward correction could be underway. That correction could move the rate up into resistance at 1.3820, followed by 1.3860-1.3880 if the EUR continues to advance.

Cory Mitchell, CMT