EUR Trading Outlook (25-07-2014)

EUR/USD Europe lifted EUR across the board after EZ PMIs came in better than forecast. EUR/USD was lifted from below 1.3440 to a 1.3485 high before slipping back near 1.3470 into NY’s open. Better than f/c US weekly claims data put the USD and US yields on firm footings. EUR/USD dipped to 1.3458 but further losses weren’t in the cards. Short squeezes in EUR/GBP (0.7889-0.7939) and EUR/AUD (1.4215-1.4312) combined with JPY weakness in EUR/JPY (136.37-137.19) to push EUR/USD back towards 1.3470 late in the day. Japanese CPI for June and German IFO for July are the big econ risk factors overnight. Particular attention will be placed on the German data as the market looks to see if the Russia/Ukraine situation has impacted business sentiment. Should the data be benign traders may look at techs that are flashing some s-t warning s for bulls. Risks may be to the topside as traders may cut back shorts heading into the weekend.