A fresh upside breakout in the Euro is justified by short covering action following an extremely entrenched bearish 8 month slide on the charts and because of slightly positive German ZEW results. However, it also goes without saying that the brunt of the rise in the Euro is probably a direct knee-jerk reaction to the slide in the Dollar into the Fed decision. For the Euro to get anything other than technical short covering action might require a Russia withdrawal from the Ukraine and the prospect of an end to sanctions, but that is a long and winding road that would require Putin to change his personality. Near term upside targeting is seen up at 1.2544.
Technical Outlook: Momentum studies are trending higher from mid-range, which should support a move higher if resistance levels are penetrated. The close above the 9-day moving average is a positive short-term indicator for trend. The market tilt is slightly negative with the close under the pivot. The next upside target is 125.1325. The next area of resistance is around 124.7450 and 125.1325, while 1st support hits today at 124.0950 and below there at 123.8325.