The Euro is probably seeing some lift from news that Euro zone wage growth improved in the 4th quarterand that Euro labor costs also rose as that dampens the deflation threat. With Euro zone January constructionlevels also posting a gain overnight, it would appear like the Euro enters the Pre-Fed window with a macroeconomic edge. The trend appears to remain up on the charts and the bull camp clearly has the advantage ofrecent economic data flows, but we also think that some caution by Euro bulls is in order, especially with the JuneEuro this morning sitting roughly 200 points above the March lows. The trend might be up, but the overboughtstatus on the charts could mean that corrections inspired by the FOMC might be aggressive. Up trend channelsupport in the June Euro is seen all the way down at 1.3835.
Technical Outlook: Studies are showing positive momentum but are now in overbought territory, so somecaution is warranted. A positive signal for trend short-term was given on a close over the 9-bar moving average. Itis a mildly bullish indicator that the market closed over the pivot swing number. The next upside objective is139.8500. With a reading over 70, the 9-day RSI is approaching overbought levels. The next area of resistance isaround 139.6400 and 139.8500, while 1st support hits today at 139.0000 and below there at 138.5700.