A surprisingly strong French PPI reading has provided some fresh fundamental support, but it has beenthe positive developments over recent weeks that are doing the heavy lifting for the Euro this morning, as priceshave made a quick return above the key 138.00 level. As long as risk appetites continue to mend, the Euro shouldremain fairly well supported heading into year-end. A strong move well above the post-FOMC meeting spike highmay be ambitious given the lack of substantive news from the region this morning, but a new high close clearlylooks to be in the cards for the Euro heading into the weekend. The March Euro will find near-term resistancearound the 139.06 level later in today’s session and as long as the usual cast of EU trouble spots can stay out ofthe headlines, the Euro may be preparing for one more upside leg before the November/December uptrend finallyruns out of steam.
Technical Outlook: Stochastics trending lower at midrange will tend to reinforce a move lower especially ifsupport levels are taken out. The market’s short-term trend is negative as the close remains below the 9-daymoving average. It is a mildly bullish indicator that the market closed over the pivot swing number. The nextdownside target is 136.7000. The next area of resistance is around 137.0100 and 137.1000, while 1st support hitstoday at 136.8100 and below there at 136.7000.