While the June Euro has been able to respect support of 1.3800 it would appear as if the upsidemomentum seen in early April has waned and that the Euro is fighting a liquidation wave. However, with the ECBovernight suggesting that the ECB will act if the Euro continues to rise that could pull in buying interest, as thecurrency markets tend to sense the prospect of intervention and in many cases the trade seems to ferret out orforce the hand of the central banks. Left to its own fundamentals we favor the downward tilt, especially into whatcould be positive US scheduled data later today, but the bull trend in the Euro might not die easily. TheCommitments of Traders Futures and Options report as of April 15th for Euro showed Non-Commercial traderswere net long 27,775 contracts, an increase of 5,229 contracts. The Commercial traders were net short 6,690contracts, an increase of 4,279 contracts. The Non-reportable traders were net short 21,085 contracts, anincrease of 950 contracts. Non-Commercial and Non-reportable combined traders held a net long position of6,690 contracts. This represents an increase of 4,279 contracts in the net long position held by these traders.Critical support in the June Euro is 1.3802 and then not until the 1.3787 level.
Technical Outlook: The daily stochastics have crossed over down which is a bearish indication. Momentumstudies trending lower at mid-range should accelerate a move lower if support levels are taken out. The market’sclose below the 9-day moving average is an indication the short-term trend remains negative. The downsideclosing price reversal on the daily chart is somewhat negative. It is a slightly negative indicator that the close waslower than the pivot swing number. The next downside target is 137.6875. The next area of resistance is around138.3850 and 138.7875, while 1st support hits today at 137.8350 and below there at 137.6875.