Technically, on the depicted chart the EUR/USD pair has confirmed a reversal Head and Shoulders pattern around 1.3190 which has its neck-line located around 1.3000.
Confirmation took place on April 23, when the pair made obvious 4H closure below 1.3000 which was supported by S1 around 1.2970. It pushed the EUR/USD pair again above 1.3000. However, the pattern remains valid as long as the pair is fixed below R1 around 1.3130.
Moreover, today the pair managed to consolidate below its minor supply located at 1.3025 which comes to meet 100-day SMA on the 4H chart. Hence, its breakdown will directly lead towards the next target level at S1 around 1.2970.
Supply Zones: R1 around 1.3130 and R2 around 1.3190.
Demand Zones: S1 around 1.2970, S2 around 1.2930, and S3 around 1.2870.
Fundamentally, the total quantity of domestic and deposited currency in banks in the euro zone fell more than expected last month, according to official data released today. Moreover, Lending to the private sector Index in the euro zone has not seen any change in the previous month, according to official data released today. This supports the short-term bearish view as well.
