The September Euro has also calmed down after a bumpy ride this week, and while more than 1 cent below Tuesday’s 6-month highs it has generally been able to hold its ground near the top end of its recent uptrend. This morning’s second quarter German GDP reading confirmed their modest growth, which has fed into the recent theme of a slow but steady recovery from the region’s protracted recession. While the German economy has been outperforming the rest of the Euro zone during most of this year, it has also been equally important that peripheral EU trouble-spots have been able to avoid any serious risk flare-ups over the past few weeks. While the Euro may see a subdued finish to this week’s trading, the market is likely to stay well clear of yesterday’s spike lows. The September Euro may find near-term support around the 133.46 level, and will be looking for stronger global risk appetites in order to finish out this week with a positive tone.
Technical Outlook
EUR (SEP): The daily stochastics gave a bearish indicator with a crossover down. Momentum studies are trending lower from high levels which should accelerate a move lower on a break below the 1st swing support. The market’s short-term trend is positive on the close above the 9-day moving average. The upside daily closing price reversal gives the market a bullish tilt. It is a slightly negative indicator that the close was lower than the pivot swing number. The next downside target is 132.7425. The next area of resistance is around 133.9950 and 134.2425, while 1st support hits today at 133.2450 and below there at 132.7425.