EUR Trading Outlook (20-10-2014)

EUR/USD Europe pushed EUR/USD to 1.2840/50 resistance in their morning as it followed EUR/JPY’s spike from near 135.75 to 13.71 due to improved risk sentiment. A slight pullback from the resistance zone saw the pair near 1.2810 at NY’s open. NY made another try at the resistance as risk rallied on the China headlines. The attempt failed though and EUR/USD gave back all the early NY gains and then some. The pair broke hourly support near 1.2780 and eventually hit a low of 1.2744. Activity settled quickly then as the market was likely exhausted from whippy action earlier in the week. A slight bounce had EUR/USD just above 1.2760 late in the day. Action may be limited in the early part of next week as there is no major data due. The second half of the week may see things heat up though as the US releases CPI on Wednesday. Several EZ nations then release Sep & Oct Markit services & manufacturing PMIs on Thursday. Weak results from the EZ data likely puts pressure on EUR/USD. A return to the 1.2600 area may then be due. Should the data come in above f/c 1.2900 might break and key resistance near 1.3000 might be tested.