Like the Dollar, the Euro has also managed to consolidate recently and that suggests the Euro is oversoldand that some players are not willing to bet on a Fed change later this week. Overnight the Euro zone managedrise in 2nd quarter labor costs and wages and that probably serves to thicken support in the December Euro downat 1.2918. An issue that leaves the Euro under a liquidation watch is the threat that Russian sanctions willescalate and or Russia will decide to use natural gas as a tool against European incursion into the Ukraine. TheEuro might bounce if the Fed remains on hold but that news probably won’t alter the down trend in the Euro.
Technical Outlook: Rising from oversold levels, daily momentum studies would support higher prices,especially on a close above resistance. A positive signal for trend short-term was given on a close over the 9-barmoving average. The market has a slightly positive tilt with the close over the swing pivot. The next upsideobjective is 130.2425. The market is approaching oversold levels on an RSI reading under 30. The next area ofresistance is around 130.1950 and 130.2425, while 1st support hits today at 129.6050 and below there at129.0625.