EUR/USD traded mostly sideways yesterday and closed almost unchanged. Further range trading is expected but improving downward momentum suggests a bias for a deeper downside probe.
EUR/USD has to break clearly below 1.0750 to indicate the start of a fresh down-leg. In the meanwhile, we prefer to hold a neutral view.
GBP/USD continues its recent decline by easily breaking below the strong 1.4480 support resulting in a sharp drop to a low of 1.4352.
While the down-move is severely oversold, the next significant support is further down at the May 2010 low of 1.4228.
Overall, only a move back above 1.4570 would indicate that a short-term low is in place.