EUR Trading Outlook (25-09-2014)

EUR/USD Europe pushed EUR/USD lower from hourly resistance near 1.2865 early in their session. Further pressure was added on the soft German IFO and the pair sat near 1.2850 into NY’s open. The pressure remained as HFs who looked to sell above 1.2900 on Sep 23 came to market. Broad USD strength emerged in NY and EUR/USD’s slide quickened as macro names were noted USD buyers. The Sep 22 low was cleared and a quick move towards the 1.2800 barrier took hold as US names were big sellers. Defense of the barrier was solid at first as very large bids into 1.2800 were noted. Relentless bear pressure saw them give way though. The 1.28 break saw a quick dive to 1.2785 followed by a small bounce back to 1.2800. The pair eventually hit a 1.2774 low as the USD stayed firm. A small bounce was seen after some dovish Fed comment. The bounce faded and the pair sat just above the low late in the day. The new trend low and long upper wicks on the Sep 23 and weekly candles build bearish sentiment. RSIs are biased down & yield spreads widen to add weight. A 1.2740/50 test looks imminent.