Underpinning the Euro this morning is a positive German industrial output result but fears of a breakdown in Greek talks is widespread after Athens made it clear they won’t be blackmailed by collateral hard ball. According to Greek officials they need a bailout extension to even negotiate further. A pattern of higher lows and higher highs on the Euro charts leave the technical trend pointing upward but the Euro bulls will have to skirt the non-farm payroll result carefully. In other words, the Euro bulls need a goldilocks payroll result, too weak and the fear of global slowing might be seen again, too strong and the Dollar will rush back into vogue at the expense of the Euro. We can’t rule out a temporary test of up-trend channel support down at 1.1333 through the report this morning.
Technical Outlook: Stochastics are at mid-range but trending higher, which should reinforce a move higher if resistance levels are taken out. The cross over and close above the 18-day moving average indicates the intermediate-term trend has turned up. The upside closing price reversal on the daily chart is somewhat bullish. A positive setup occurred with the close over the 1st swing resistance. The near-term upside target is at 116.4175. The next area of resistance is around 115.8550 and 116.4175, while 1st support hits today at 113.9050 and below
there at 112.5175.