EURUSD bulls attempted to break to fresh highs on Monday but failed as they stumbled upon a big psychological resistance at $1.13. With a muted dollar, a light calendar and a relatively slow start to the week, euro traders decided to trade small. Right now, they are patiently waiting for the critical ZEW economic data due to be released. Analysts expect German and euro area sentiment to leave recessionary levels after a depressing period of over one year.
Rejected At $1.13, A Deeper Correction Is Now Possible
It has been a good run for the EURUSD since the double bottom down at $1.1180. Euro rode 140 pips in an impulse move to the upside and received a rejection as the 1.618 Fibo extension at $1.1322 and the upper channel trendline rejection weighed prices down. Since then, the popular pair started correcting down to $1.1289 with the first leg (A to B) suggesting a deeper correction towards $1.1269, or lower.
