The pair could not break the strong resistance level of 1.3100 on Friday and fell back sharply in the U.S session where it tested its previous low of 1.2990, after the consumer sentiment report was released for the U.S that is now at 6-year high level.
Currently, the pair is moving at 1.3027 level where a move above its daily pivot point at 1.3035 could take it to test 1.3060 and then strong resistance level of 1.3084, where heavy selling could be seen again. As for the downward side, if the pair manages to break its support of 1.3000 then it could continue its bearish movement as the pair would target 1.2974 and 1.2950.
Today's key economic indicators to watch are the manufacturing and unemployment numbers for Italy and the Euro Zone, where a sharp move could be seen after the release of ISM Manufacturing PMI of the U.S in the U.S session.
The pair has been in a bearish rally for the past week as it made a fresh new low at its strong support level of 1.5165 in the U.S session on Friday, after the U.S consumer sentiment delighted the USD investors. The pair then retraced back upwards to its 38.2% Fibonacci level and is currently moving at 1.5219, where a move above its pivot point of 1.5230 could create bearish consolidation as the pair would target to test 1.5249 and 1.5277.
However, if it fails to move above pivot point, then it would continue moving down as it could re-test its Friday's low of 1.5165, breaking of which could lead it to test 1.5136 and 1.5108.
The manufacturing PMI and Net lending to Individuals data are set to be released today in the European session, where one-sided data could cause a good movement in the pair.
The metal made a fresh new low after 2 to 3 years at the level of 1179 but could not sustain below the psychological level of 1200 and hence closed above 1230 level on Friday. Gold is currently trading at 1244.70 right now at the start of the London session, where it has a strong resistance at 1250 level which is the 200-EMA on its 30-minutes chart.
The overall outlook on the metal is still bearish where many analysts are expecting it to drop down further after breaching its 1179 low of Friday, but investors are buying it just because of the psychology that comes into play as many institutions have buy orders set at 1200 level.
If the metal moves down 1230 mark then it may go on to test 1223, where a sustainable move below that level could take it back to 1200 mark. Things may get a bit clear for the metal in the U.S session today after the release of ISM Manufacturing PMI data.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.