EUR/USD to set fresh eight-month lows

EUR/USD traded on the downside yesterday, owing to uncertainty over European economic outlook and despite positive inflation data. The newest eight-month low at 1.0650 has already been touched Tuesday morning. We are now fully focusing on the April low at 1.0519, the closest major support which is reinforced by the monthly S2, weekly S3 and lower Bollinger band from above. Intermediate demand is offered by the weekly S2 at 1.0602. Trading volume remains at the highest level in three weeks, meaning volatility of the market may persist in the nearest future.

Bulls raised their share to 56% by Tuesday morning, the highest level in more than three months. Pending orders, however, deteriorated to just 35% for bulls in 100-pip range from the spot market price.