The downtrend is still very much in control on the short-term charts so selling rallies back to resistance areas around 1.2740 makes the most sense to me. Bulls will want a premium for entering the market ie a silly dip, in the absence of any basing formation. EUR/JPY has steadied after yesterday’s sell-off which was driven by real-money funds. This cross as always will determine the EUR fate during Asian trade and it’s outlook remains bearish in short-term whilst below 101.30. On a fundamental note, the large increase in Spanish inflation is also a worry as most social payments are index-linked and could lead to a big increase in outlays for an already overly indebted government.