EUR/USD has dropped aggressively from 1.1370 yesterday's high and now is retesting potential dynamic support, resistance has turned into support. The pair is located in the buyer's territory, but the false breakout above the 1.1348 has signaled a bearish pressure again.

The better than expected Unemployment Claims report has boosted the dollar in the short term, the indicator was reported at 1314K in the previous week, beating the 1375K estimates.

• EUR/USD Rejected From Dynamic Resistance!

EUR/USD has plunged after it has reached the outside sliding line (SL) of the descending pitchfork and now has pressured the 23.6% level and the upper median line (UML), a false breakdown, rejection from these levels could send the rate higher again.

The dollar has taken the lead again as the USDX has rebounded from 96.23 level, making only a false breakdown with huge separation below the 96.36 static support. The 96.36 - 96.00 area represents a critical support zone for the US dollar index, so another leg higher will force the EUR/USD to drop again.

Unfortunately, yesterday's candle has endangered a further drop in the upcoming period, now, the outside sliding line (SL) represents a critical resistance, a valid breakout above this line will suggest buying again.

• EUR/USD Trading Tips

Buy - EUR/USD will resume its upwards movement if it will make a valid breakout above the sliding line (SL) and above the R1 (1.1403) level. Still, a consolidation above the UML, and above 23.6% (1.1268) level could bring a long opportunity sooner. The near term resistance is seen at the 1.1348 and at the sliding line (SL).

Sell - I still believe that a selling signal will be validated by another lower low, buy a valid breakdown below the 1.1200 psychological level. The near-term support is represented by the upper median line (UML) and by the PP (1.1251) level.