Euro Expected to React at 1.2945

EUR USD day-traders have their first big read at 1.2945.

EUR USD day-traders have their first big read at 1.2945.  This price marks a Fibonacci retracement of the 1.2456 to 1.3737 range.  A test of this level could trigger a short-covering rally.

The first test of this level is likely to attract profit-taking.  Counter-trend buyers may also step in at 1.2945.  Short-term traders will have to decide whether to pull in their short-positions and play for the retracement or leave the position alone for a breakout to the downside.

Either way this is not a good area to initiate new selling.  Watch for a momentum shift as the market approaches this area.