EUR/USD tumbles to 2-month lows, nearing 1.1400 mark

   •  Italian budgetary concerns continue to weigh on the shared currency.
   •  Disappointing flash Euro-zone PMI prints exert additional pressure.
   •  Technical set-up points to further weakness ahead of ECB on Thursday.
 
The EUR/USD pair finally broke down of its Asian session consolidation phase and tumbled to over two-month lows in the last hour.

After yesterday's good two-way price action, the pair came under some renewed selling pressure on Wednesday and resumed with its near-term bearish trajectory. 

Against the backdrop of concerns over Italy's budget proposals, the shared currency was further weighed down by today's disappointing Euro-zone flash PMI figures. 

In fact, the German flash manufacturing PMI dropped to a 29-month low level of 52.3 and the composite Euro-zone flash manufacturing PMI touched a 26-month low of 52.1 in October.

Adding to this, a goodish pickup in the US Dollar demand exerted some additional downward pressure, taking along trading stops placed near the 1.1435-30 region, previous monthly lows.

With today's data out of the way, a follow-through weakness, led by some fresh technical selling, now looks a distinct possibility ahead of the latest ECB monetary policy update on Thursday.

Technical levels to watch

Weakness below the 1.1400 handle is likely to find some support near the 1.1385 region, which if broken is likely to accelerate the slide further towards the 1.1345 horizontal support.

On the flip side, the 1.1430-35 region now becomes immediate resistance and is closely followed by mid-1.1400s, above which the pair is likely to recover further towards 1.1475-80 supply zone.