Daily Outlook: Technically we still remain in a strong downtrend on all significant timeframes, and several significant supports have been broken recently, all bearish signals. The pair also carved out a fresh 4-year low below 1.19 yesterday. This is after the bearish break of the descending triangle, which still has a few hundred pips to go before it completes its likely pattern. But in the same breath markets are oversold, there was a bullish doji on the daily charts (GMT) yesterday and with descending triangles they retrace to the bottom of the triangle (1.2100) or at least the falling resistance line (1.2080) a good percentage of the time.
So there is reason to look for shorts, but reason to also be patient and wait for a solid, high-probability setup as well.
The key resistance is 1.2140 - if we stay below this I will continue to look for shorts. Key resistance is 1.1875 - the fresh 4-year low.
On a side note for those of you skeptical that the EURUSD could hit 1.000 by the end of the year, remember that is was as low as 0.85 as recent as late 2001. It shot up to 1.60 last year on heavy speculation and bad US news.
Trading Idea: Primary trade will be same as yesterday: shorts below 1.2080. Short targets at 1.2050, 1.2020, 1.1990 and 1.1960 for 120 pips profit. A more aggressive trade would be a short near 1.2050 and the most conservative trade is a short near 1.2140.