FXstreet.com (Barcelona) - The Euro has started to erode support level at 1.4000, with a brief excursion to 6-month low at 1.3935, before returning above 1.4000, where it might consolidate on the near-term, ahead of furter decline to 1.3860, says Karen Jones, technical analyst at Commezbank.

Jones sees the pair consolidating at current levels before dropping further, targeting 1.3860 area: EUR/USD has eroded 1.4000. It has not yet closed below its 55 week moving average at 1.3980 and may see some near term consolidation ahead of losses to its 200 week moving average at 1.3860.

On the upside, profit-taking reactions are likely to be capped at 1.4218, says Jones: While this is likely to provoke some profit taking here, while capped by the 1.4218/December low, it will remain directly offered.