The EUR/USD rallies an seems motivated to reach fresh new highs in the upcoming period. Price has managed to breakout above a very important dynamic resistance as the USDX drops like a rock. The dollar index seems unstoppable on the short term, we’ll see how will react when will touch the 92.49 static support.

USDX dropped much below the 93.00 psychological level and moves very quickly towards the 92.49 crucial support, it could reach this downside obstacle till the end of the day as the United States data have disappointed earlier.

The Euro goes up also because has received strong support from the German Ifo Business Climate increased unexpectedly in the current month, from 116.8 to 117.5 points, beating the 116.6 estimate.

On the other hand, the greenback has taken a serious punch from the economic data, the Flash Services PMI decreased from 55.3 to 54.7 points, even if the traders have expected to see an increase to 55.5 points. Moreover the Flash Manufacturing PMI dropped from 54.6 points to 53.8 points, failing to increase and to reach the 55.1 estimate. The poor data have signaled that the expansion has slowed down in the manufacturing and services sectors.

Price rallied and ignored the upper median line (uml) of the minor descending pitchfork and above the outside sliding line (sl) of the descending pitchfork. A valid breakout will confirm an increase at least till the median line (ML) of the major ascending pitchfork.

The major upside resistance remains at the 1.2042 static resistance, only a breakout above will signal a further increase on the short to the medium term. It could be attracted by the confluence area formed between the 1.2042 with the median line (ML). Remains to see what will happen till the end of the day because a minor drop in the upcoming hours that will force the rate to close below the sliding line (sl) will signal an exhaustion, but this scenario is less likely to happen.