With a gap down failure on the charts, weak European equities and lingering talk of additional US taperingearly in 2014 leaves the path of least resistance is pointing downward in the Euro. The euro seemed to comeunder pressure in the wake of slack Chinese PMI data and given the upside breakout in the Dollar this morning,the March Euro might be poised for a quick dash down to the consolidation lows around 1.3649. Even lowerconsolidation low support is seen down at 1.3625. Seeing the Euro under noted pressure this morning in the faceof another annual high in German employment readings is very discouraging especially with the Germaneconomy reportedly creating 232,000 jobs last year. However, the trade is apparently of the mind that the USeconomy is poised to outgrow the Euro zone and it also seems as if the trade is also of a mind that the US Fed ispoised to taper policy quicker than ECB officials. A 4 month old up trend channel support line is seen down at1.3446 today with that support line rising to 1.3454 on Monday of next week.
Technical Outlook: Positive momentum studies in the neutral zone will tend to reinforce higher priceaction. The market’s short-term trend is positive on the close above the 9-day moving average. The market setupis somewhat negative with the close under the 1st swing support. The near-term upside objective is at 138.3525.The next area of resistance is around 137.8950 and 138.3525, while 1st support hits today at 137.2050 and belowthere at 136.9725.