EUR Trading Outlook (14-08-2014)

EUR/USD Europe tried to run the pair through the August 12 low but failed as profit taking from s-t macros halted the drop and a low of 1.3342 was hit. The subsequent bounce had the pair near 1.3365 into NY’s open and the US retail sales data. No silver lining could be found in the miss to the sales data. This buoyed the recent tip by Yellen & co. that US rates won’t be rising too soon in order to avoid harming the US econ. The USD dived down across the board. EUR/USD spike to a 1.3416 high. No further gains were possible though. European RM names and intra-day profit taking stalled the lift. The USD mounted a comeback and all the post-sales gains eroded. EUR/USD dipped to 1.3355 before a bounce in the afternoon had it settle the day just above 1.3365. Trades now look to the EZ HICP final and GDP reports. Should the data come in below expectations EUR/USD is likely to make a serious attempt at taking out 1.3295/1.3325 support. Weak data may prompt added action from the ECB beyond the TLTRO [ID:nIFR9zTqTl]. A break below 1.3295 then eyes support near 1.3100.