EUR/USD falls sharply and erases gains

FXStreet (Córdoba) - The EUR/USD retreated sharply from daily highs following the latest string of data showed Eurozone consumer confidence and US existing home sales came in slightly better-than expected.

The Eurozone consumer confidence preliminary reading came in at -0.8 versus -9.05 expected, while on the other side of the Atlantic existing home sales dropped 0.2% versus -0.4% expected and the Richmond Fed manufacturing index rose to 7 against 0 forecasted.

The EUR/USD broke below the 1.3800 psychological level and accelerated to a session low of 1.3788 so far. However, the pair has managed to hold above its European session low of 1.3484. At time of writing, the EUR/USD is trading at 1.3790, virtually unchanged since opening.

EUR/USD technical outlook

"Technical readings maintain a neutral stance while a daily descendant trend line coming from past Friday's high converges with the 1.3825 static resistance", said Valeria Bednarik, chief analyst at FXStreet. "Dollar weakness may keep the pair supported, albeit only a price acceleration above mentioned 1.3825 resistance would favor an upward continuation today".

Bednarik locates immediate resistance levels at 1.3825, 1.3860 and 1.3890, while she sees supports at 1.3780, 1.3750 and 1.3720.