Undermining the Euro to start today is news of a fresh all-time high in French unemployment for the month of November. With a possible Russian credit rating reduction later this week, the fear of spillover weakness on large portions of the Euro zone remains a very distinct threat. Down trend channel resistance is seen in the Euro at 1.2225 and that might be a good fresh short entry point for a continuation of the entrenched downtrend pattern in the March Euro.
Technical Outlook: The sell-off took the market to a new contract low. Daily stochastics declining into oversold territory suggest the selling may be drying up soon. The close below the 9-day moving average is a negative short-term indicator for trend. The defensive setup, with the close under the 2nd swing support, could cause some early weakness. The next downside objective is now at 121.1525. The next area of resistance is around 122.1950 and 122.7725, while 1st support hits today at 121.3850 and below there at 121.1525.