EUR Trading Outlook (28-10-2014)

EUR/USD The below f/c German IFO numbers pushed EUR/USD lower from near the Asia high and had it near 1.2770 into NY’s open. NY made one early push lower & hit a low of 1.2665 but no further looses could be made. A bounce above 1.2780 took hold then as MNSI quoted ECB sources citing barriers to QE and that need to let old measures work. The sources also noted a GC move in ’14 is unlikely absent a big econ or inflation shit. A few rounds of soft US econ data aided to speed EUR/USD’s lift higher as US bond yields and the USD were heavy. The pair cleared spec offers into 1.2700 and hit a high of 1.2723 and left stops for those specs at 1.2725 untouched. Some profit taking by intra-day longs and stall in the USD’s slide prevented further gains but little pullback from the high was seen. Late in the day the pair sat just above 1.2710. There is no major data due from the EZ so traders will look to the USD side of the equation for direction. Tomorrow’s durable goods & consumer confidence data may ignite some sparks. The Fed meeting Wed. is the next big risk. Short covering until then cannot be ruled out.