FXstreet.com (Barcelona) - After the deep EUR/USD pullback off highs, "a further decline in coming weeks leading into the Italian election and to reverse its little blowout above 1.35 appears more likely near term" says Greg Gibbs, currency strategist at RBS.

Greg adds: "EUR/USD is hovering just above 1.35, a level that appeared to trigger significant stop loss buying last week. This suggests there is likely to be stop losses below that level. EUR can fall several big figures and still appear in a rising trend from its lows in July. As such it feels vulnerable to a bigger correction just on uncertainty over coming weeks into the Italian election."