The EUR/USD pair fell down to 1.0497, right after London's opening, barely recovering some ground after the release of the German IFO survey. Business sentiment rebounded in February with the index up to 111.0 from previous 109.8, with the assessment of the current situation up to 118.4 and expectations also on the rise, up to 104. Euro area annual inflation was 1.8% in January 2017, up from 1.1% in December 2016, down monthly basis by 0.8%, as expected.
Still pending of release are US existing home sales and the Minutes of the latest FOMC meeting. The common currency remains pressured by political woes in the region, and is among the most vulnerable to dollar's strength, particularly if the Minutes are seen as hawkish.
The pair trades at its lowest since January 11th, and at risk of falling further, given that the 1.0520 previous support now acts as immediate resistance, containing the short-lived recovery from the mentioned low. Technical readings favor additional slides as in the 4 hours chart, the 20 SMA has accelerated its decline well above the current level, whilst technical indicators maintain soft bearish slopes within oversold territory, with no signs of changing bias.
A downward acceleration through 1.0490 should lead to a test of 1.0453, Feb. 11 low, with further slides below it pointing to a decline down to the 1.0420 region. Above 1.0520 on the other hand the pair can recover up to 1.0565, the 23.6% retracement of the post-US election slump.
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