The euro currency touched a three-day low on Friday at 1.2080 before recovering. Price action is subdued for the past three sessions with a lower high currently forming.
This comes after price slipped to a three-month low at 1.1951 on February 5th. The downside bias is starting to build up.
The common currency will need to rise above the recent swing high of 1.2187 in order for the upside bias to hold.
Failure to do so could potentially open the way for further declines, especially if the swing low of 1.1951 gives way.
For the moment, the support area near 1.2050 will be critical to the downside. The Stochastics oscillator is moving up and could signal another test to the resistance area near 1.2144 – 1.2177.