More coiling in the Euro and a lack of upside action in the face of weakness in the Dollar suggests the Euro generally remains out of favor. Talk of bond buying by the ECB has seemingly left the Euro off balance and to avoid fresh technical damage on the charts this morning probably requires initial respect of a key pivot point at 1.1338. One might expect the Euro to see some benefit from news of ongoing Chinese stimulus efforts but in the short term, the Euro is simply missing out on the potential windfalls from a series of new high moves in global equities and from a step wise improvement in global economic prospects.
Technical Outlook: Declining momentum studies in the neutral zone will tend to reinforce lower price action. The market’s short-term trend is negative as the close remains below the 9-day moving average. With the close higher than the pivot swing number, the market is in a slightly bullish posture. The next downside target is now at 113.1150. The next area of resistance is around 113.9300 and 114.1950, while 1st support hits today at 113.3900 and below there at 113.1150.