The Euro is showing some minor bounce this morning and perhaps some of that rise is the result ofrotation out of the Dollar in the wake of an increase in Russian sanctions and the potential for retaliation againstthe US. Limiting the upside in the Euro is a down tick in Euro zone May Construction and CPI readings that werebarely able to climb above unchanged levels. As suggested in Dollar coverage this morning expectations for USscheduled data flow call for slack to weak data and that is probably set to give the Euro a slight lift later thismorning. Initial support is seen at 1.3526 but resistance might not be seen until the 1.3564 level.
Technical Outlook: Momentum studies are still bearish but are now at oversold levels and will tend tosupport reversal action if it occurs. The market’s short-term trend is negative as the close remains below the 9-day moving average. The market setup is somewhat negative with the close under the 1st swing support. Thenext downside objective is 134.8675. The next area of resistance is around 135.5250 and 135.8875, while 1stsupport hits today at 135.0150 and below there at 134.8675.