The Euro has found some support on the charts above the 1.3479 level and that isn’t surprising when oneconsiders that Euro zone data has come in relatively better than data from the US recently. In fact, seeing Eurozone producer prices rise on the month overnight and seeing the US data falter recently has probably providedthe Euro with most of its capacity to bounce up from last week’s lows. However, forward economic progression inthe Euro zone could be compromised, if US data continues to soften and the US Fed remains hawkish regardlessof ongoing declines in equities and emerging market fears. If the US economic outlook is set to deteriorate further,that could set the stage for a near term slide in the March Euro back below the 1.34 level.
Technical Outlook: The downside crossover (9 below 18) of the moving averages suggests a developingshort-term downtrend. Momentum studies are still bearish but are now at oversold levels and will tend to supportreversal action if it occurs. The market’s short-term trend is negative as the close remains below the 9-day movingaverage. The upside daily closing price reversal gives the market a bullish tilt. With the close higher than the pivotswing number, the market is in a slightly bullish posture. The next downside target is now at 134.5800. The nextarea of resistance is around 135.5999 and 135.7800, while 1st support hits today at 135.0000 and below there at134.5800.