With the ECB President promising to throw everything that is necessary at the unresponsive Euro zone economy and the PBOC and BOJ clearly in a softening stance, the dominance of the Dollar over the Euro is likelyto entrench. Slumping wage inflation figures from Italy overnight weigh on the Euro but that news was partiallycountervailed by reports that German tax revenues have largely held together. While the huge range down movethis morning factors in a large portion of the Euro negative news flow, a retest of consolidation support down 1.24might be temporary and a fresh lower low might be in the cards directly ahead.
Technical Outlook: Positive momentum studies in the neutral zone will tend to reinforce higher priceaction. The market’s close above the 9-day moving average suggests the short-term trend remains positive. Themarket’s close below the pivot swing number is a mildly negative setup. The next upside target is 126.1375. Thenext area of resistance is around 125.7949 and 126.1375, while 1st support hits today at 125.0850 and belowthere at 124.7175.