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[B]Yesterday it was Spain and today its Portugal – EUR/USD broke below another important technical barrier and continues the free-fall. An update on European events and on technical levels for EUR/USD.[/B]

Moody’s put Portugal [URL="http://www.marketwatch.com/story/moodys-puts-portugal-on-review-for-downgrade-2010-05-05"]on review[/URL] for a credit downgrade. This took [URL="http://www.forexcrunch.com/category/forex-weekly-outlook/eur-usd-outlook/"]EUR/USD[/URL] to the next level – the 1.2886 support line, which was the low point in April 2009, held strong for only a few hours. Moody’s decision sent the pair below this level. The pair is now trading at 1.2820. That’s not the only event:

[B]The news[/B] ...

[B]Yet again, expectations are high from the upcoming Non-farm payrolls release. Great expectations can turn into great disappointments, but this seems like a win-win situation for the greenback. Here’s what to look for from this release of the “king of forex”.[/B]

According to economists’ estimations, American Non-Farm Payrolls are predicted to show another month of strong gains – 200K. If this is realized, it will be the second month in a row of gains reported in the initial release.

Until last month, we’ve only seen gains in revisions – initial releases, for the month that just ended, were negative. [URL="http://www.forexcrunch.com/dollar-rallies-on-job-gains/"]Last month’s gain[/URL], 162K, fell ...

[B]U.S. ADP Non-Farm Employment Change is looking good, The ISM Non-Manufacturing PMI is also on the rise and U.S. Federal Reserve Bank of Boston President Eric Rosengren delivers a speech. These items together with more good news, await us today.[/B]

In the US, ADP Non-Farm Employment Change, estimates a rise of 29000 in the number of employed people in the U.S. which is really good news for the American dollar after the drop of 23000 from last month. We still need to see the results of the Non-Farm Employment Change report on Friday to confirm this positive notion.

Later in the US, The Institute for Supply Management Non-Manufacturing PMI measuring the Level of a diffusion index based on surveyed purchasing ...

[B]A rumor that Spain will ask for 280 billion euros of aid money in order to deal with its debt is running in the past few hours in trade rooms. This is what’s bringing down the Euro.[/B]

EUR/USD now trades at 1.3120, very close to the 2010 low and approaching the 1.3080 support line. This line is the place where EUR/USD began the long term rally in 2009, and it’s about to return to this point:

Read the rest of the article about the rumored [URL="http://www.forexcrunch.com/rumor-spain-will-ask-for-280-billion-of-aid/"][I][B]Spanish aid pledge[/B][/I][/URL].