The December Euro was one of the earliest and strongest beneficiaries of the Summers withdrawal news last night, but has already given back a sizable portion of overnight gains early this morning. Today’s Euro zone Inflation numbers were generally in-line with market forecasts, but they remain on the low side for a region that has been showing signs of growth. While next week’s German elections and the “Troika” visits to Portugal and Spain are shadowing the market, today’s general “risk on” market mood should help to keep the Euro fairly well supported at these levels. The Euro is once again showing signs of being reluctant to breech the 134.00 level, however, and may need the FOMC meeting out of the way to make a decisive move through that price area. The December Euro may pull back to the 133.34 area later today, but should remain in positive territory throughout the balance of today’s trading session. The Commitments of Traders Futures and Options report as of September 10th for Euro showed Non-Commercial traders were net long 14,066 contracts, a decrease of 11,498 contracts. The Commercial traders were net long 221 contracts, an increase of 11,397 contracts which represents a change from a net short to net long position. The Non-reportable traders were net short 14,288 contracts, a decrease of 100 contracts. Non-Commercial and Non-reportable combined traders held a net short position of 222 contracts. These traders have gone from a net long to a net short position.
Technical Outlook
EUR (SEP): Stochastics are at mid-range but trending higher, which should reinforce a move higher if resistance levels are taken out. The market’s short-term trend is positive on the close above the 9-day moving average. The market has a slightly positive tilt with the close over the swing pivot. The next upside objective is 133.6150. The next area of resistance is around 133.3300 and 133.6150, while 1st support hits today at 132.6500 and below there at 132.2550.