Consolidating after break lower | 03 December 2013

EUR/USD has broken down through its 45° trend-line and posted a long column of red o's. Whilst this is not a definitive signal of a resumption of the bear trend it is a sign of weakness and could be the start of such a resumption. Taking a downside count from this column gives us a target at 1.3370. A nearer-term level of support is at the 1.3475 trend-line, and if prices move below 1.3520 they will probably fall to there and consolidate first; if they break down it would provide strong bearish signal lower. The trend-line at 1.3475 is pivotal: if there is a recovery from there it would continue the bearish move higher, if it breaks down it will signal a probable resumption of the down-trend.