The 16-nation currency fell for the second day in the absence of economic data from the euro zone, ahead of the release of banks tests results next week as investors preferred not to take long positions till the announcement of the results.
Eyes are on the results that are expected to restore confidence in markets; European governments mentioned that certain procedures might take place after the announcement of results. Trichet said on Friday that fiscal crisis are not over yet and banks should continue to accept help from the ECB.
With regard to the euro-dollar pair, it is declining on the daily charts as the pair has reversed from an overbought area doing a downside correction starting from Friday asthe euroreached the highest level in two months versus the greenback. However, the pair is currently facing an upside pressure from the 4-hour and 1-hour charts.
Currently, the pair is trading at 1.2567 while earlier today it recorded a high of 1.2647 and a low of 1.2548, whereas it is predicted to move between support and resistance at 1.2505 and 1.2695 respectively.
On the other hand, the dollar advanced for the second day against a basket of major currencies as seen by the dollar index which climbed to 84.31 from 83.99 after getting support at 83.70 on Friday.
As for the sterling-dollar pair, it retreated for the second day after the sterling has touched its highest level against the dollar in five weeks. Today's data showed that the British economy expanded for the second quarter after growing 0.3% in the first quarter, but fears that recovery is still fragile, as manufacturing and services' expansion eased in June, are affecting the sterling.
Meanwhile, the pair is trading at 1.5008 as the breach of strong support at 1.5055 paved the way for strong decline. Earlier today, the pair recorded a high of 1.5079 and a low of 1.4946, while for the rest of the day, the pair is expected to move between support at 1.4960 and resistance at 1.5075.
Relative to the dollar-yen pair, it halted its rebound witnessed in the prior three sessions as the Japanese Prime Minister lost control over the upper house party which raised concerns with regard trimming the huge sovereign debt.
For now, the pair is trading at 88.58, recording a high of 89.15 and a low of 88.51, whereas support is seen at 87.65 while resistance is at 89.55.