Despite approval for the Greek debt extension, general optimism in global equity markets for most of this week and signs of troop stand-downs in the Ukraine, the Euro hasn’t been able to get out from under its long entrenched downward trend action on the charts. In fact, despite noted improvement in Euro zone economic data and generally disappointing US data this week, the euro still sits just above to its January contract lows. We would expect to see a minimal bounce in the Euro off slack US data early, but we just don’t see the Euro reversing its downward bias today.
Technical Outlook: The moving average crossover down (9 below 18) indicates a possible developing short-term downtrend. Momentum studies are still bearish but are now at oversold levels and will tend to support reversal action if it occurs. The market’s short-term trend is negative as the close remains below the 9-day moving average. The close below the 2nd swing support number puts the market on the defensive. The next downside target is 110.4275. Some caution in pressing the downside is warranted with the RSI under 30. The next area of
resistance is around 112.9450 and 114.3675, while 1st support hits today at 110.9750 and below there at 110.4275.