The soft US ISM data pushed the USD pairs to lower levels. The ISM index little changed to 58.7 last month, the second-strongest level since April 2011, compared with 59 in October. In the euro area, the Italian manufacturing output slightly weakens. The currency pair managed to hold margin gains on the previous week and in yesterday's session. It doesn't mean, the Euro is looking attractive. The US dollar paused its rally and shifted to a consolidation stage. The pair made a minor base at 1.2358, below this 1.2320 is the strongest support. The Euro is still favoring the sell on every upswing. The further direction will be determine on Thursday's ECB meeting. A lot of pressure is still being put on the Euro. Today, the focus has shifted to Spanish unemployment data.The pair has strong, long-term support at 1.2226. Below 1.2226, levels 1.2045 and 1.1876 are another multiple support levels. We have been recommending selling on every upswing with the downside initial targets at 1.2320 and 1.2230.

From an intraday view, the pair has support at 1.2460. Until the prices remain below 1.2531, the selling pressure continues. We recommend selling at 1.2450 with the targets at 1.2420, 1.2400, and 1.2360. The weakness will turn to selling pressure below 1.2420; panic will be triggered below 1.2360. If a weekly close is below 1.2350, we can expect 500 odd pips correction on the downside in the longer-term view. The pair has strong, long term support at 1.2226. Below 1.2226, 1.2045 and 1.1876 are another multiple support levels. We have been recommending selling on every upswing with the down side initial targets at 1.2320 and 1.2230 levels.