EUR/USD Forecast: Further Weakness Below 1.1770 level

The EUR/USD pair remained under some selling pressure for the fourth consecutive day and dropped to one-week lows during the Asian session on Tuesday. The latest political landscape in the Eurozone, wherein Catalonia President Carles Puigdemont didn't clarify his position regarding independence and Social Democrats defeated Chancellor Angela Merkel's Christian Democrats in an election in the northern state of Lower Saxony on Sunday, has been one of the key factors weighing on the shared currency.

Adding to this, a strong follow-through US Dollar buying interest further collaborated to the pair's fall back below the 1.1800 handle. Monday's strong US economic data and rising US Treasury bond yields supported the greenback, which got an additional boost on reports that the US President Donald Trump would meet Janet Yellen for a potential second term as Fed Chair. 

Today's economic docket features the release of German ZEW economic sentiment and the final Eurozone CPI print, which would be looked upon for some impetus during the European trading session. Later during the day, the US import/export prices and industrial production data would also help traders grab some short-term trading opportunities.

From a technical perspective, the pair is currently placed near its immediate support near the 1.1780-70 region, marking a 23.6% Fibonacci retracement level of its recent slide from 1.2092 to 1.1669. A clear break below the mentioned support would confirm a fresh bearish breakdown and turn the pair vulnerable to head back towards retesting the 1.1700 handle with some intermediate support near mid-1.1700s. 

On the flip side, the 1.1800 handle now seems to act as immediate resistance and any subsequent recovery attempts might now be capped at the 38.2% Fibonacci retracement level near the 1.1830 region.