EUR/USD testing wedge lows ahead of EZ risk events

FXStreet (Bali) - EUR/USD has been buffeted in an wedge pattern since Nov 5th amid absence of catalysts to break either side, although the maturity of the technical formation and EZ GDP/US Retail Sales should act as catalyst to set the next short term direction for the pair, which remains in a firm downtrend.

While a surprising EZ GDP may see fast money/leveraged accounts launch an attack towards stops 1.25+, as long as below 1.2535/40, the immediate risks should remain lower, with some risks of a bull trap. Only above 1.2540 should see further extension to 1.2565/75, where a fresh smattering of offers are touted. On the downside, a break through the ascending trendline (wedge dynamic support) should see 1.24/2410 bids tested ahead of recent lows.