The Euro accelerated lower on weaker than expected PMI data on Friday (German Manufacturing Dec 51.5 vs 51.8 f/c, Services Dec 52.5 vs 53.4 f/c / EU Manufacturing Dec 51.4 vs 51.9 f/c, Services Dec 51.4 vs 53.5 f/c) suggesting weaker growth in Q4.
Weak data added to negative near-term outlook, as long upper shadows on daily candles of this week (including strong upside rejection at daily cloud base / pivotal Fibo barrier at 1.1440 zone) signal that bulls were lacking strength to break higher.
Fresh weakness generated negative signal on break below 1.1314 (Fibo 61.8% of 1.1215/1.1472 upleg) and higher base at 1.1305 and pressure 1.1267 support (28 Nov trough), loss of which would expose key supports at 1.1215 (12/13 Nov double-bottom) and 1.1186 (Fibo 61.8% of larger 1.0340/1.2555 rally).
Stronger bearish acceleration would risk test of 1.1159 (neckline of asymmetric H&S pattern on weekly chart), as completion of pattern would open way for further weakness.
Negative setup of daily indicators maintains bearish pressure, along with falling thick daily cloud (spanned between 1.1431 and 1.1558).
Cluster of converged, south-turning daily MA’s (10,20,30), marks solid barriers at 1.1340/50 zone, which is expected to limit upticks and keep bears in play.
Res: 1.1305, 1.1314, 1.1350, 1.1393
Sup: 1.1327, 1.1300, 1.1267, 1.1215
