FXstreet.com (London) - EUR/USD has continued south this session, as Greenback went stronger on FOMC hawkish language yesterday. Pair has dropped off, tripping large stops along the way between the 1.3900 and 1.400 range. Currently trading approximately 45 pips down from the open. Pair currently quoting at 1.3986, up form session lows of 1.3936.
The US president has made clear his backing for Bernanke to continue in his position as Chairman of the central bank, the FED. Market continues with a risk aversion bias and negative mood, fearing reduced capital inflows as banks are squeezed by central powers, in light of the recent clamping down on bank liquidity.
For primary resistance we take 1.4040 (US session consolidation level), and for support to we look at 1.3940 (intraday low). Pair trades at 6 ½ month lows, and dealers are forecasting the downtrend to continue, with next target at 1.3800 [Source:DowJones]