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EURUSD (1.1688): The EURUSD currency pair was seen easing back from the resistance level of 1.1730 on Monday. Price action retraced some of the gains made from Friday. On the 4-hour chart, the minor support is seen at 1.1686 level. As price action is seen testing this level, a rebound of this support is required to keep prices floated to the upside. Failure to hold the support could trigger a decline back to 1.1600 level.

The U.S. dollar was seen managing to stabilize on Monday. Economic data was sparse. In the NY trading session, the existing home sales report showed a decline to 5.38 million. This was slower than the forecasts of 5.44 million.

The previous month’s data was revised to 5.41 million and the report marked a third consecutive month of decline in existing home sales.

The economic calendar today will see the release of the flash services and manufacturing PMI figures from Markit covering the Eurozone and the U.S.

Activity in the Eurozone is expected to show a broadly unchanged picture while in the United States, activity in the manufacturing and services sector is expected to show a slight moderation from the previous month's increase.

The U.S. Richmond Fed manufacturing index will be coming out later with forecasts pointing to a decline in the index from 20 last month to 18.

Pivot (invalidation): 0.7400

Our preference Short positions below 0.7400 with targets at 0.7355 & 0.7340 in extension.

Alternative scenario Above 0.7400 look for further upside with 0.7415 & 0.7435 as targets.

Comment As Long as 0.7400 is resistance, look for choppy price action with a bearish bias.

Pivot (invalidation): 1.3145

Our preference Long positions above 1.3145 with targets at 1.3200 & 1.3225 in extension.

Alternative scenario Below 1.3145 look for further downside with 1.3110 & 1.3080 as targets.

Comment Technically the RSI is above its neutrality area at 50.

Pivot (invalidation): 0.9900

Our preference Long positions above 0.9900 with targets at 0.9950 & 0.9975 in extension.

Alternative scenario Below 0.9900 look for further downside with 0.9880 & 0.9855 as targets.

Comment The RSI lacks downward momentum.

Pivot (invalidation): 111.50

Our preference Short positions below 111.50 with targets at 111.00 & 110.80 in extension.

Alternative scenario Above 111.50 look for further upside with 111.90 & 112.20 as targets.

Comment As Long as the resistance at 111.50 is not surpassed, the risk of the break below 111.00 remains high.

Pivot (invalidation): 1.3150

Our preference Short positions below 1.3150 with targets at 1.3080 & 1.3045 in extension.

Alternative scenario Above 1.3150 look for further upside with 1.3180 & 1.3215 as targets.

Comment A break below 1.3080 would trigger a drop towards 1.3045.

Pivot (invalidation): 1.1720

Our preference Short positions below 1.1720 with targets at 1.1670 & 1.1635 in extension.

Alternative scenario Above 1.1720 look for further upside with 1.1750 & 1.1780 as targets.

Comment As Long as the resistance at 1.1720 is not surpassed, the risk of the break below 1.1670 remains high

Pivot (invalidation): 1.1620

Our preference Short positions below 1.1620 with targets at 1.1600 & 1.1585 in extension.

Alternative scenario Above 1.1620 look for further upside with 1.1640 & 1.1655 as targets.

Comment A break below 1.1600 would trigger a drop towards 1.1585.

Pivot (invalidation): 0.8935

Our preference Short positions below 0.8935 with targets at 0.8910 & 0.8900 in extension.

Alternative scenario Above 0.8935 look for further upside with 0.8955 & 0.8975 as targets.

Comment The index currently faces a challenging resistance area at 0.8935.