And the Euro has finally reached the 1.3900 level versus the Dollar.

We have been anticipating this visit of the EUR/USD to the 1.3900 level since the pair reached the 61.8% Fibo. We should notice that around the 1.3900 level we also have the 76.4% Fibonacci Retracement, which has contributed to the price stalling at that area. On the daily chart below, courtesy of the Forex Broker Activtrades http://www.activtrades.co.uk/, it seems like the price wants to bounce to the downside from this level, but what the price has really done is consolidate just below the 1.3900.

The pair is clearly overbought and prone for a correction at any moment. That is why there is a good probability of prices bouncing to the downside from here. But we must be objective and realize that the upward momentum stays strong and it could also break this zone to the upside.