EUR/USD slides farther below 1.19 handle amid a modest USD recovery

The EUR/USD pair finally broke down of its Asian session consolidation phase and has now dropped to fresh session lows, around the 1.1870 region. 

On Monday, the pair failed to sustain its early up-move back above the 1.1900 handle as traders seemed noncommittal ahead of the very important ECB monetary policy decision on Thursday.

The pair's latest leg of sharp slide of around 40-pips, during early European session, could be primarily attributed to a modest US Dollar recovery. 

Bulls also seemed unimpressed from the final Euro-zone Services PMI figures for August. In fact, the Spanish, Italian and French PMI prints fell short of original estimates, while the composite PMI, at 54.7 also came-in slightly below the flash reading of 54.9.

Looking at the broader picture, the pair has been oscillating within a broader trading range and hence, it would be prudent to wait for a decisive break in either direction before committing to the next leg of directional move.

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Technical levels to watch

On a sustained weakness below mid-1.1800s, the pair is likely to accelerate the fall towards 1.1825-20 intermediate support before eventually breaking below the 1.1800 handle. 

Meanwhile, on the upside, any up-move back above the 1.1900 handle might continue to confront fresh supply near the 1.1920-25 region, which if cleared could assist the pair to aim back towards reclaiming the key 1.20 psychological mark.