Forex technical analysis: EURUSD moves back down after correction

Keeps the bears more in control

The EURUSD had a slow grind higher into the London/European morning session - making it's way toward the 38.2-50% of the move down from Friday. That area proved far enough and we are seeing a slow grind back to the downside.

Looking at the daily chart, the pairs rally fell short of the underside of the broken trend line. The lows from August 18/19 are being tested at the moment. A move below that level and then the 1.1000 level should have traders thinking lower again with the 1.0938 (61.8% of the move up from the March low) as the next major target below.

The range for the EURUSD is 61 pips. The average over the last 22 trading days is 101 pips. So there is room to roam on an extension. New home sales are eyed at 10 AM. No Fed speakers as we are in the quiet period with the FOMC decision on Wednesday. Durable goods, consumer confidence and Richmond Fed due out on Tuesday.