The Euro remains pinned down near the recent lows in the wake of fresh sanctions against Russia. Supporting the Euro is mostly favorable German trade surplus readings and the realization that Spain saw somepositive action in a home price report. Apparently the trade is set to remain negative toward the Euro despite thepositive data flows and that would seem to suggest that the latest sanctions have left the bears in control of theEuro. The Commitments of Traders Futures and Options report as of September 2nd for Euro showed Non-Commercial traders were net short 165,183 contracts, an increase of 11,533 contracts. The Commercial traderswere net long 211,006 contracts, an increase of 12,999 contracts. The Non-reportable traders were net short45,823 contracts, an increase of 1,467 contracts. Non-Commercial and Non-reportable combined traders held anet short position of 211,006 contracts. This represents an increase of 13,000 contracts in the net short positionheld by these traders. Critical support in the September Euro is seen at 1.2932 today and the failure to hold thatlevel might send the Euro quickly down to 1.2900.
Technical Outlook: Daily stochastics declining into oversold territory suggest the selling may be drying upsoon. A negative signal for trend short-term was given on a close under the 9-bar moving average. It is a slightlynegative indicator that the close was under the swing pivot. The next downside target is 128.8400. Selling maysoon dry up since the RSI is under 20 indicating the market is extremely oversold. The next area of resistance isaround 129.8600 and 130.2400, while 1st support hits today at 129.1600 and below there at 128.8400.