EUR Trading Outlook (17-07-2014)

EUR/USD Europe’s bears pressed EUR/USD lower through their morning. EUR sales inspired mostly by EUR/GBP selling after UK jobs initiated EUR/USD’s slide. Selling began near the 1.3570 area and continued into NY’s open where the pair sat just below 1.3540. The June PPI was above f/c and the USD and US bond yields got a bid as mkt fears of earlier than anticipated rate hikes grew. EUR/USD slipped to 1.3525. A bounce ensued as US yields slipped a bit. Softer than f/c IP and cpacity rates for June aided to soften yields and the USD. EUR/USD touched 1.3540 but sellers emerged. A steady decline took hold, aided by EUR sales vs. AUD & CAD, and the pair sat just above the day’s 1.3521 low late in the day. Bears now look to EZ & US data tom for further help. EZ June CPI is due & the US gives us weekly claims data as well as June building permits & housing starts data. Should CPI come in soft & the US data reflect recent upbeat US data EUR/USD is likely to test the 1.3475/1.3505 support zone. A break of that area likely accelerates the recent slide. Bears then target Nov’s low (1.3295) then Sep’s low (1.3105).