Mixed results from the region’s economic data continues to thwart the Euro’s ability to revive its recentuptrend, as the market is still well below last Wednesday’s high for the move early in this morning’s trading.Today’s Service Sector and Composite PMI readings followed their recent pattern of German out performance,sluggish French readings and a modest up tick for the region as a whole. However, a negative surprise from theEuro zone Retail Sales number may be of more immediate concern as it comes right in front of tomorrow’s ECBmeeting. Fresh easing measures from the ECB may be a remote possibility at best, but lukewarm results from”hard” economic data will not be to the Euro’s advantage if US numbers stay positive in front of Friday’s Payrollrelease. The December Euro should find near-term support around the 135.72 level later this morning, and at thispoint the Euro needs to get the ECB meeting and post-meeting commentary in its rear-view mirror beforeretesting last week’s highs.
Technical Outlook: The market now above the 40-day moving average suggests the longer-term trend hasturned up. Daily stochastics have risen into overbought territory which will tend to support reversal action if itoccurs. The close above the 9-day moving average is a positive short-term indicator for trend. The daily closingprice reversal up on the daily chart is somewhat positive. The market setup is supportive for early gains with theclose over the 1st swing resistance. The next upside target is 136.7225. The next area of resistance is around136.3850 and 136.7225, while 1st support hits today at 135.4750 and below there at 134.9025.