Prices moved lower as expected after putting in a bearish Dark Cloud Cover candlestick pattern. Sellers are now testing the 23.6% Fibonacci retracement at 1.2904, with a confirmed break on a daily close below this level targeting the 38.2% Fib at 1.2739. Near-term resistance is at 1.3042, the underside of a recently broken rising trend line set from the November 13 low. A push above that targets the top of a channel carved out since mid-September (1.3093).
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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