EUR/USD's gains to be limited by 1.2580

The Euro managed to pare Monday's losses yesterday after rebounding from the weekly S1 at 1.2428. Nevertheless, the near-term outlook remains bearish—the four-month down-trend is still intact. Even if it is breached, there are resistances at 1.264 and 1.274 that are highly unlikely to allow EUR/USD to sustain a recovery for long. Only violation of the 38.2% Fibonacci retracement of May-Nov sell-off at 1.30 will be considered long-term bullish.

EUR/USD continues to be characterised by indecision in the market—the bulls (51%) and the bears (49%) are equally strong. As for the orders, the share of the buy ones is growing and it already amounts to 59%.