Today's support and resistance levels:

R3: 130.68

R2: 130.23

R1: 129.81

Current spot: 129.58

S1: 129.23

S2: 128.97

S3: 128.61

Technical overview:

The minor correction from 130.41 has been a little bigger than we expected, but that does not change our view that the next powerful rally higher is to begin soon. We are currently looking for a break above 129.81 and more importantly a break above 130.23, which confirms that the next rally higher towards at least 132.07 is underway. However, we expect this next rally to extend and find it more likely that we will see a continuation higher towards 133.90. In the short-term, we expect support at 129.47 and, more importantly, support at 129.23 to protect the downside for the break above 129.81. That said, an unexpected break below 129.23 will only indicate a slightly deeper decline towards 128.97 and maybe 123.67 before the next move higher sets in.

Trading recommendation:

We long EUR from 127.30 with a stop at 128.35 and take profit and reversal of the position at 135.00. If you do not have long EUR positions already, then buy at a break above 129.81 with the same stop.