While able to shake off early pressure, the Euro has shown lackluster price action as it also may bewaiting on the Fed to revive its current uptrend. An in-line set of German jobs data and Euro zone sentimentreadings provided fresh evidence of steady growth for that region, but comments by a key ECB official that theyhave no tools against a strong Euro failed to provide any lasting support. At this point, the Euro may have to relyon a surprising dovish Fed to make a run back towards the 138.00 level as a large portion of recent strength hasbeen due to diminished Fed tapering prospects. The December Euro may find near-term resistance around the137.74 level, and may need to find additional support “from home” in order to begin the next leg higher of thislonger-term uptrend.
Technical Outlook
EUR (DEC): A bearish signal was triggered on a crossover down in the daily stochastics.Momentum studies are trending lower from high levels which should accelerate a move lower on a break belowthe 1st swing support. The close below the 9-day moving average is a negative short-term indicator for trend.There could be some early pressure today given the market’s negative setup with the close below the 2nd swingsupport. The next downside target is 136.8425. The next area of resistance is around 137.8450 and 138.3825,while 1st support hits today at 137.0750 and below there at 136.8425.