EUR/USD dropped further to as low as 1.2162 last week as the near term down trend continued. Further fall is still in favor initial this week for 61.8% projection of 1.3282 to 1.2287 from 1.2747 at 1.2132. Though, considering bullish convergence condition in 4 hours MACD, strong support could be seen at 1.2132 projection level to bring rebound. Above 1.2333 minor resistance will indicate short term bottoming and flip bias back to the upside for a test on 1.2747 resistance. Meanwhile, sustained break of 1.2132 will target a test on 1.1875 key support level.
In the bigger picture, fall from 1.4939 is treated as a falling leg inside the consolidation pattern that started at 1.6039 (2008 high) and could extend to 1.1875 low and below. In that case, though, strong support is expected from 1.1639/1875 support zone to contain downside and bring rebound. After all, such consolidation would extend further inside range of 1.1639/6039 for some more time. On the upside, decisive break of 1.2747 resistance will be the first sign of reversal and will turn focus back to 1.3486 for confirmation.
In the long term picture, EUR/USD turned into a long term consolidation pattern since reaching 1.6039 in 2008. Such consolidation is still in progress and we'd expect range trading to continue for some time between 1.1639 and 1.6039. For long term traders, anywhere below 76.4% retracement of 1.1639 to 1.6039 at 1.2677 could be treated as a buy zone while above 23.6% retracement at 1.5001 is a sell zone, until there is clear indication of breakout. That this, it's time for long term traders to liquidate EUR/USD shorts and start building up long positions for medium term rebound.