FXstreet.com (Barcelona) - Karen Jones, Head of Technical Analysis at Commerzbank has taken a look at EUR/USD from a technical perspective.

Jones notes that EUR/USD has sold off to it´s 38.2% retracement of the recent leg higher at 1.2948 and she expects to see spot hold this initial test and prompt a rebound. She thinks that rallies will find initial resistance at 1.3017/23 and will ideally remain contained by the 1.3127 recent high. She sees key resistance at 1.3150/80 and she is looking at this price as a possible cap to the upside.

Failure at 1.2949 should be enough to trigger further near side weakness to initially 1.2900/2880, the low from 28th November, en route to 1.2800/2788, the 200 MA and the the 2661 November low. Jones notes that the 1.3150/80 zone consists of the recent high and double Fibonacci retracement and this remains tough overhead resistance. Jones is currently short at 1.3057 and has since lowered her stops to entry, with a target of 1.2900.