The Sept Euro remains well inside of yesterday’s range this morning, but has been able to steer clear ofdownside follow-through after yesterday’s reversal. A better-than expected reading on Euro zone ConstructionOutput has provided a mild boost to prices, but there are still too many lukewarm to sluggish data results in therecent past for the Euro to sustain any upside momentum. While a surprisingly dovish Fed could provide a sourceof strength later today, the Euro looks to be heading for a retest of the 1.3505 low from earlier this month. Neartermresistance may be found at the 1.3586 level, but another downside leg for the Sept Euro appears to be onthe horizon.
Technical Outlook: The stochastics indicators are rising from oversold levels, which is bullish and shouldsupport higher prices. The market’s short-term trend is negative as the close remains below the 9-day movingaverage. The daily closing price reversal down puts the market on the defensive. It is a slightly negative indicatorthat the close was under the swing pivot. The near-term upside objective is at 136.1000. The next area ofresistance is around 135.7499 and 136.1000, while 1st support hits today at 135.2300 and below there at135.0600.