EUR Trading Outlook
EUR/USD The EZ Oct PMI came i above f/c and EUR/USD covered a bit. The rally lifted the pair to a 1.2676 high just ahead of NY's open. It sat just below that level as NY got going. The rally couldn't push further. After the worse than f/c jobless claims were reported US bond yields and the USD firmed up as risk sentiment was buoyant. Even EUR/JPY's rally from the 136.10/15 are to a high of 137.01 couldn't lift EUR/USD. Instead EUR/USD slid lower for most of the NY session. The pair traded near 1.2630 into Europe's close. The NY afternoon saw the pair range in the 1.2662//1.2638 range as the USD remained firm and EUR/JPY maintained its bid tone. Late in the day EUR/USD sat just above 1.2650. There is little major EZ data that will impact EUR. German Sep GfK consumer confidence and the UK's Q3 GDP report are the main risks for EUR traders overnight. Unless there are major surprises to those data points EUR/USD may hold to its recent 1.2625/1.2845 range.
EUR/USD Europe pushed EUR/USD from the day's high (1.2740) to 1.2681 ahead of NY's open on HF sales and a report from EFE that 11 banks will fail the stress test. The pair bounced a bid off the low & sat near 1.2690 as NY got going. NY lifted the pair as the ECB released a statement saying media reports on the tests outcome are by their nature highly speculative. EUR/USD rallied towards the 200-HMA but fell short as it could only reach 1.2728. The lift began to fade. The pair's slide picked up its pace after US CPI headline data came in above forecasts. A quick dive to 1.2660 ensued. Some consolidation took hold but the limited bounces met selling pressure. Risk sentiment soured in NY's afternoon as stocks erased all earlier gains and turned negative on the day. EUR/USD slid with risk and hit a new low of 1.2642. Very little bounce was seen and the pair sat just above 1.2645 late in the day. Economic data presents the next risks for EUR/USD. China's Oct HSBC Mfg PMI and numerous EZ PMIs are due. Soft results should weigh on EUR further. Daily lows in the 1.2585/1.2625 zone may then get tested. Breaks of those lows puts the 2014 low back in play
EUR/USD Europe bought the dip presented to them as they walked in the door. General USD weakness saw short covering take the pair form near 1.2735 towards 1.2770 into NY's open. Early NY saw a spike up to 1.2790 get rebuffed. A bout of JPY strength drove EUR/JPY from near 136.70 to a NY low of 136.27. EUR/USD drifted lower to test hourly support near 1.2750/55. The dip was bought though as USD weakness dominated and improved risk sentiment sent stocks higher. EUR/JPY rallied off its NY low and sat just above 136.80 late in the day. EUR/USD lifted off the NY low, cleared the overnight high and touched 1.2811. Very little pullback was seen and the pair sat just below 1.2810 late in the day. shorts may get squeezed further after the pair bounced nicely off the 10-DMA. Day/week RSIs are biased up and spreads hold near recent tights. If China's Q3 GDP should see an upside surprise, risk may rally strongly and EUR/USD may get take higher.A test of 1.2900 resistance may then take hold. Should that resistance give way there isn't much to stop a bigger squeeze until the 1.30 area where the 55-DMA& Sept high sit.
EUR/USD Europe pushed EUR/USD to 1.2840/50 resistance in their morning as it followed EUR/JPY's spike from near 135.75 to 13.71 due to improved risk sentiment. A slight pullback from the resistance zone saw the pair near 1.2810 at NY's open. NY made another try at the resistance as risk rallied on the China headlines. The attempt failed though and EUR/USD gave back all the early NY gains and then some. The pair broke hourly support near 1.2780 and eventually hit a low of 1.2744. Activity settled quickly then as the market was likely exhausted from whippy action earlier in the week. A slight bounce had EUR/USD just above 1.2760 late in the day. Action may be limited in the early part of next week as there is no major data due. The second half of the week may see things heat up though as the US releases CPI on Wednesday. Several EZ nations then release Sep & Oct Markit services & manufacturing PMIs on Thursday. Weak results from the EZ data likely puts pressure on EUR/USD. A return to the 1.2600 area may then be due. Should the data come in above f/c 1.2900 might break and key resistance near 1.3000 might be tested.
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