Traders have to be impressed with the action in the Euro over the last 24 hours as renewed fears toward Greece have been present but haven’t been given as much credence as some might have feared last week. Reports of Euro buying by the SNB leaves the bull camp in control of the Euro this morning. Perhaps some players are buying the Euro because of the “hard ball” stance presented to Greek banks in the form of sharply higher borrowing costs and sharply lower valuations for Greek bank shares hints at an endgame to the recent debate. In other words, the Greeks would like to alter the bailout agreement but German officials in particular are not showing signs of caving in. Perhaps the markets are growing more confident in the EU getting beyond the Greek situation by not accepting Greek bonds as collateral, as that calls the bluff of the new regime in Athens. Seeing the Euro rise in the face of calls for fresh sanctions against Russia is another sign of new found bullishness toward the Euro. However, traders need to guard against weak US data, as that could be seen as a development that deflates recovery potential in the Euro zone. Near term critical support in the March Euro is seen at 1.1388 and a rise above 1.1490 could signal a shift back into a long term recovery track.
Technical Outlook: Stochastics are at mid-range but trending higher, which should reinforce a move higher if resistance levels are taken out. The market’s short-term trend is positive on the close above the 9-day moving average. The market’s close below the 1st swing support number suggests a moderately negative setup for today. The near-term upside target is at 115.2575. The next area of resistance is around 114.2650 and 115.2575, while 1st support hits today at 112.9150 and below there at 112.5575.