Today's support and resistance levels:

R3: 128.45

R2: 127.95

R1: 127.50

Current Spot: 127.40

S1: 127.03

S2: 126.85

S3: 126.13

Technical overview:

The short-term important support was attacked again yesterday and once again the attempt failed. The lack of downside pressure is kind of worrying and as the structure of the decline from 129.90 is very overlapping, we should stay alert. The very overlapping decline from 129.90 can mean two things. 1) That a leading diagonal has been building. If this is the case we should likely see a rally towards 127.80 and maybe even higher towards 128.24 or 128.63 in wave ii before the real downside pressure takes over. 2) That the decline from 129.90 has been a triple zigzag correction. If this is the case, we should soon see a new much bigger rally materializing towards at least 131.46. Both scenarios are calling for some upside pressure for now, but the slightly longer outcome will be totally different. For now we will just have to wait and see, which scenario is the right one. However our slightly preferred count is the leading diagonal count.

Trading recommendation:

We short EUR from 128.20 and we will book our nice little profit here at 127.40. We will resell EUR near the falling channel resistance line at 128.63 or upon a break below 127.03 with a stop at 129.25.