Euro encounters resistance

After a brief recovery, the euro encountered resistance in the $1.2500 region against the greenback.

Mario Draghi
Source: Bloomberg

The fundamentals just continue to work against the single currency and ECB President Mario Draghi is also consistently aiding the weakness. Mr Draghi spoke again and reinforced that all assets are under consideration should additional measures be required. The downtrend on EUR/USD has been in place since August and capped prices through October and November. Failure to close above this resistance yesterday has seen traders resume shorts and will likely be targeting November lows at $1.236 in the near term. A potential catalyst for price action today is likely to be the euro area flash CPI report. Until the pair closes above the downtrend resistance, I feel traders will continue to look for selling opportunities on rallies.   

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