The Euro has managed to get some slightly supportive economic dialogue overnight from German officials and from the promise of more aggressive stimulus from the ECB next week. The euro saw upbeat dialogue from the German Finance Ministry regarding the prospect of better growth ahead and perhaps a reversal in the Dollar into the next Fed meeting is providing some short covering in the Euro. Up-trend channel support is seen at 1.2385 and it would not be surprising to see a very surprising significantly explosive short squeeze rally in
the Euro into and through next week’s EU and Fed meetings. Buy a January Euro 1.2550 call for 580.
Technical Outlook: Stochastics are at mid-range but trending higher, which should reinforce a move higher if resistance levels are taken out. The close below the 18-day moving average is an indication the intermediateterm trend has turned down. The market could take on a defensive posture with the daily closing price reversal down. The market setup is somewhat negative with the close under the 1st swing support. The next upside objective is 125.4750. The next area of resistance is around 124.6600 and 125.4750, while 1st support hits today
at 123.4000 and below there at 122.9550.