The Euro lost traction after repeated test of near-term congestion tops and fell below range low at 1.2260 on Tuesday.
Downbeat German inflation data (German inflation slowed more than expected and hit 15-month low in Feb) were initial trigger for bearish acceleration, which was further inflated by stronger dollar on Fed Powell’s testimony.
Today’s fall could be initial signal of fresh weakness after 30SMA repeatedly capped rallies, but bears still need a catalyst.
Close below 1.2260 would be negative signal to maintain fresh bearish sentiment for extension towards key supports at 1.2205 (09 Feb low) and 1.2173 (Fibo 38.2% of 1.1553/1.2555 rally) with sustained break here to generate strong bearish signal for deeper correction.
Alternative scenario would require lift above 30SMA (1.2344) and converged 10/20SMA’s (1.2355/59) to neutralize and shift focus higher.
Res: 1.2277; 1.2310; 1.2346; 1.2360
Sup: 1.2247; 1.2205; 1.2173; 1.2160
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