The Euro has managed to hold within striking distance of the prior session high despite Euro zonemanufacturing data that was a little soft. In fact, the Euro generally remains in favor as a portion of the tradethinks the prospect of fresh stimulus from the ECB is unlikely this week. With the Euro this morning sitting roughly100 points above its recent lows and Euro zone data remaining soft, Euro bulls are at risk of pressure from USdata directly ahead. Traders might consider the purchase of June Euro puts into a near term peak just above 1.38this week.
Technical Outlook: Daily stochastics are trending lower but have declined into oversold territory. A negativesignal for trend short-term was given on a close under the 9-bar moving average. It is a mildly bullish indicatorthat the market closed over the pivot swing number. The next downside target is 136.7725. The next area ofresistance is around 138.1950 and 138.5925, while 1st support hits today at 137.2850 and below there at136.7725.