Once again, the Greenback is on the march against the Euro. Rates have fallen for the third consecutive day in the face of growing Eurozone Core CPI (YoY, Oct.) and a collection of relatively stable economic reports for the EU. During the U.S. overnight, the Core CPI number came in slightly above expectations, at 1.1%. Currency traders have largely ignored this metric and the EUR/USD is poised to end October on a down note.

A drop of more than 300 pips has been the story for the past calendar month in the EUR/USD. At this point, forex players have to wonder when this downtrend is going to reverse. Perhaps the big-round-number of 1.1300 will bring some bids to this market.

EUR/USD Technical Outlook

The 1.1300 handle was last tested in mid-August. This level represents yearly lows for 2018 and a pivotal area for intermediate-term valuations. In the event 1.1300 is taken out, we may be in for a precipitous drop to 1.1250.

Bottom Line: Until proven otherwise, one is well advised to respect the current downtrend in the EUR/USD. However, 1.1300 will bring significant participation to this market.

For the remainder of the session, I will be looking to scalp this area to the bull. Buys from 1.1303 should bring a bit of positive price action and are a cheap counter-trend play. Using an initial stop at 1.1294, this trade produces a fast 8 pips on a sub-1:1 risk vs reward management plan. Remember, this is a counter-trend trade, so a conservative use of leverage is advised.