Although market focus will shift away from a spotlight on Washington difficulties, the Euro is holding upreasonably well so far as it is only finding minor pressure early in this morning’s trading. Recent data points fromthe Euro zone have provided few highlights, but have avoided the kind of market-rattling headlines that wouldhave taken attention away from a chronically weak Dollar. As long as potential EU trouble-spots remain subdued,the Euro will remain fairly well supported and will stay in relatively close proximity to last Friday’s high for themove. The December Euro may slide back towards the 136.62 area this morning, but is likely to avoid any seriouspressure before tomorrow’s US jobs data as long as the EU stays out of market news headlines.
Technical Outlook
EUR (DEC): Daily stochastics have risen into overbought territory which will tend to support reversalaction if it occurs. The market’s close above the 9-day moving average suggests the short-term trend remainspositive. It is a mildly bullish indicator that the market closed over the pivot swing number. The near-term upsideobjective is at 137.3175. The market is becoming somewhat overbought now that the RSI is over 70. The nextarea of resistance is around 137.1150 and 137.3175, while 1st support hits today at 136.6650 and below there at136.4175.