The EUR/USD has recovered some of its intraday losses after the Dollar appreciated across the board in reaction to news that Chinese banks are being aggressive in limiting new loan volume. The Euro received some good news after Germany's Ifo Business Climate and French Consumer Spending outperformed. Furthermore, the EU's current account registered a slight surplus after analysts anticipated a deficit of -3.1 billion. Hence, it seems demand for EU goods and services is recovering faster than anticipated, a positive development for the Euro which has been hammered the past couple weeks. However, investors should keep in mind that last week's Flash PMI data left something to be desired. Therefore, EU economic data is painting a mixed picture. Regardless, today's encouraging data set has allowed the Euro to strengthen and make up for some lost ground, highlighted by a solid up-bar taking place in the EUR/GBP right now. Attention will now shift back to the U.S. with CB Consumer Confidence on deck. Yesterday's U.S. Existing Home Sales data came in weaker than anticipated and it will be interesting to see how the Dollar reacts should today's CB number also disappoint. Although the EU will release German Prelim CPI tomorrow, attention will be centered on the Fed's monetary policy meeting. That being said, volatility could remain at a heightened state in the FX market over the next couple trading sessions, especially considering the earnings season is just beginning to heat up.

Technically speaking, the EUR/USD faces topside technical barriers in the form of multiple downtrend lines along with 1/25 highs. As for the downside, the EUR/USD has our 1st and 2nd tier uptrend lines serving as technical cushions along with previous January lows and the psychological 1.40 level. Our 1st tier uptrend line could carry some weight since it runs through some April 2009 lows. That being said, a failure of our 1st tier could send a pretty negative signal considering April 2009 lows are around the 1.30.

Present Price: 1.4096

Resistances: 1.4115, 1.4146, 1.4169, 1.4191, 1.4224, 1.4247

Supports: 1.4080, 1.4065, 1.4045, 1.4015, 1.3981, 1.3950

Psychological: 1.40