After calming the market son Friday by buying Italian bonds, the market started this week Euro-negative (after an initial upwards continuation). The EUR/USD, EUR/GBP, EUR/JPY, and EUR/CHF pairs ended their relief rally in this week's first European trading session. Let's take a look at the technical levels and setups in these euro-crosses.

EUR/USD 8/8/2011 1H Chart
1.4250 Cracking:
- The EUR/USD starte the week with an upside gap, but closed it completely by the European session.
- As we enter the US session, the market is testing 1.4250. With 1.43 already broken by a sharp decline, the EUR/USD looks primed for another slide.
- Since the July high at 1.4540, the market has been in consolidation with a bearish tilt. In this type of market, technical divergence with RSI has lead a reversal 5 times in the 1H chart, including the one we just saw over the first Asian/European session.
- However, one thing should be noted. During this consolidation, the Sunday high made the first significant higher high breaking the 1.4371 high. Therefore, we may not be able to expect the current decline to break below the previous low near 1.4054.
- A 61.8% retracement eyes 1.4190. Below that we can extend to 1.4150 and then we might have to re-evaluate unless the market is accelerating.
- As I conclude this article, the EUR/USD has slid to 1.42. Next is 1.4150.

EUR/GBP 8/8/2011 1H chart
Still Choppy, with Bearish Tilt:
- The EUR/USD was rallying before the European session, but the 200SMA and 0.8750 pivot rejected the rally, and a sharp decline followed.
- This decline has already retraced 61.8% of the rally since last Friday when the Euro-relief started.
- As the RSI points out, the market is not "trending" since the reading did not break below 30. However, it is tilted to the downside, as the reading remains mostly under 60.
- Now, if the market can push below 0.8680, we can continue lower at least to 0.8650, then to our targets near 0.8590 and 0.85.
- The bullish scenario is put aside until we see a break above 0.8750.

EUR/JPY 8/8/2011 1H chart
Cracking Rising Trendline at 110.80
- The EUR/JPY is falling after being rejected at 112.30. It was falling back below the 200SMA and the RSI has not been able to return back above 60.
- The market can be said to be ranging, but if note that that the early August rally was an intervention based rally, we expect the market's original trend (bearish) to have more weight.
- The 108.70 level is the next bearish target. The 78.6% retracement level at 109.90 can also act as a temporary support, but if the market holds below 110.80, we stay bearish.

EUR/CHF 08082011 1H Chart
- The Swissie is taking a break. The RSI in the 1H chart stuck between 40 and 60 reflects a consolidation.
- We have a 61.8% retracement and now the market should be ready to head lower.
- A good clue for bearish continuation is a break back below the  the 1.0795 pivot. The RSI should also break back below 40.
- The 1.0707 pivot to 1.07 level is the first near-term target.
- The 1.0540 target remains viable as seen in the daily chart below representing Fibonacci Expansion levels.
EUR/CHF 08082011 Daily chart

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Fan Yang CMT
Chief Technical Strategist