The Euro started European session at the back foot after short-lived recovery in Asia which was capped by previous congestion floor, now acting as initial resistance at 1.2283.
Tuesday’s strong fall was sparked after a cluster of MA’s limited upside attempts and resulted in close below four-day congestion, generating bearish signal.
Near-term outlook is negative as daily tech remain in bearish setup and favor test of next supports at 1.2240/30 (20/21 Mar double-bottom / 20-d lower Bollinger band), violation of which would open way towards key supports at 1.2154/46 (01 Mar low / daily Ichimoku cloud base).
Sideways-moving daily Kijun-sen (1.2315) is expected to keep the upside protected, while sustained break above converged MA’s (between 1.2320 and 1.2340) would provide relief.
EU CPI data is the key release of the European session. Inflation is expected to pick up in March, according to the forecast for 1.4% vs downward-revised February’s figure at 1.1%, with upbeat inflation numbers expected to boost the single currency.
Res: 1.2300, 1.2320, 1.2335, 1.2368
Sup: 1.2240, 1.2230, 1.2200, 1.2154
