EUR Trading Outlook (28-07-2014)

EUR/USD The below f/c German IFO data ignited EUR/USD’s latest leg lower in Europe’s session. The pair collapsed from 1.3475 to 1.3440 before bouncing towards 1.3455 into NY’s open. NY immediately applied pressure even after May’s durable goods orders saw a big downward revision. Sour risk sentiment due to seemingly increased Ukraine/Rusia tensions saw bond yields and stocks soft while the USD and JPY were firm. EUR/USD slipped from the NY open, pierced the 200 week MA and hit a low of 1.3421 while EUR/JPY slid from near 137.10 to a 136.65 low. Both saw only minor bounces as they held slightly above the day’s low late in the session. EUR may come under greater pressure next week with the catalyst liekly coming from the USD. Big data/event risk lies ahead. Wednesday gives us July ADP, Q2 GDP and the Fed. Friday brings the July jobs report. Should the results of this risk be USD bullish EUR/USD’s recent slide is likely to accelerate. We’re likely to then see the 200-WMA break cleanly and bears immediately target 1.3295/17 (Nov low, weekly cloud base). A break there puts the Sep low (1.3105) in play.