Mild profit-taking has taken place, ahead of Portugal's parliament vote on the government's latest austerity measures. The Prime Minister, Jose Socrates, has stated he will resign if the opposition fails to approve the bill.
EUR/USD has dropped toward the lowest price in 2 days at 1.4152 during the Asian session, although it has managed to bounce, trimming part of the previous losses. At time of writing, the cross is trading around 1.4175/80, 0.13% below its opening price.
From a technical perspective, Franco Shao, analyst at ForexCycle.com, said, "Being contained by 1.4281 (Nov 4, 2010 high) resistance, EURUSD pulled back from 1.4248, suggesting that a cycle top is being formed on 4-hour chart".
"Range trading between 1.4100 and 1.4248 is expected in a couple of days. However, the fall from 1.4248 is treated as consolidation of uptrend from 1.3752, another rise towards 1.4500 is still possible after consolidation, and a break above 1.4248 could signal resumption of uptrend", Shao added.