The EUR/USD dropped today and failed to reach and retest a dynamic resistance. Price moves somehow sideways on the short term, so we’ll have a clear direction only after a valid breakout from this range. Is very important to see what will happen on the USDX in the upcoming days, the index dropped on the short term and now is in the seller’s territory. A USDX’s further drop will force the USD to depreciate versus all its rivals.

The rate remains higher as the dollar index failed to make a larger rebound, I’ve said in the previous weeks that the dollar index is still under massive selling pressure on the Daily chart because is located under some very important resistance levels. The Euro dropped a little also because the Euro-zone data failed to impress today.

The German Final CPI rose by 0.5%, matching the 0.5% estimate and the 0.5% growth in the former reading period, while the Italian Retail Sales dropped more than expected, by 0.5%, more versus the 0.1% estimate. The Euro-zone Employment Change rose by 0.3%, matching the 0.3% estimate, while the Industrial Production dropped by 1.0%, more versus the 0.4% estimate. On the other hand, the United States data failed to impress today as well.

The rate dropped and failed to reach and retest the median line (ml) of the minor ascending pitchfork. Price is pressuring the 50% Fibonacci line (ascending dotted line) of the major ascending pitchfork, a false breakout above this level will signal a drop at least till the lower median line (lml) of the minor ascending pitchfork.

You should know that only a valid breakdown from the minor ascending pitchfork’s body will really signal a larger drop, the perspective is still bullish as long as is trapped within the ascending pitchfork’s body.