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After consolidating losses between 1.2980 and 1.2995, the EUR/USD has finally broken previous lows to trade around 1.2960, at its minimums since December 11. Below the 1.3000 level, the pair has opened the door to bearish momentum, and the 1.2900 level is now vital to contain bears, or not.

On Wednesday, the greenback was broadly higher, fueled by a stronger-than-expected ADP employment report, which highlights improvement in the labor market ahead of the NFP on Friday. Lately, the USD is trading in pro-risk mode, and its negative correlation with equities has been broken. U.S. stocks have risen on economic data, so has the USD.

The euro sentiment is weak just ahead of the ECB announcement. and regarding the ECB decision, Camilla Sutton, Chief Currency Strategist at Scotiabank, coincides with the broader market consensus and expects the ECB to leave the refi rate intact at 0.75%, focusing, however, on Draghi's presser. "Accordingly, though we expect that President Draghi ultimately turns more dovish and weighs on EUR; we expect that tomorrow's press conference is in line with February's," she remarked.

The EUR/USD resumed its slide on Wednesday, and fell below the 1.3000 round level, with Italy's political uncertainty also weighing on the shared currency. EUR/USD is now down 0.61% at 1.2970. As for the short term, next support levels align at 1.2966 (2013 low March 1) followed by 1.2929 (low December 11). On the upside, a breakout of 1.3075 (high March 5) would expose 1.3080 (MA10d) and then 1.3101 (high March 1).

Technical indicators remain bearish at this point, favoring a fall towards 1.2900/08 (psychological level/ Fib 76.4% of 1.2660/1.3710) ahead of the 1.2880 zone. However, some consolidation is expected ahead of the central bank decision and the U.S. jobs report. On the other hand, a break above 1.3100 could encourage buyers and lift the pair, although a regain of the 1.3160 area (February 28 high) would improve the outlook.

The Banks' Day Ahead

Thursday will start with the BoJ decision in the Asian session. USD/JPY investors will pay special attention, as the pair has jumped above the 94.00 level. Other banks that will release their monetary policy decisions include the BoE and the ECB. Market players must also pay attention to the German Factory orders and the U.S. jobless claims.

- BoJ Interest Rate Decision
- BoE Interest Rate Decision and Asset Purchase Facility size
- ECB Interest Rate Decision and the Draghi's press conference

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Source: Forex: EUR/USD Falls To 2013 Lows And Opens The Door To Further Losses