EUR Trading Outlook (21-11-2014)

EUR/USD Price action in early Europe defined the range for the continent and NY. EUR/USD dived down from 1.2575 to 1.2505 after EZ PMIs were generally below expectations. Short covering bids into 1.2500 were too much to overcome and the pair steadily climbed towards 1.2535 as NY got going. Early NY action saw the low end of the range tested again after US CPI came in above f/c and jobless claims were below estimates. The dip was bought though as USD weakness from overnight carried over into NY’s session. Another trip near the day’s high was made but the range held. The pair then oscillated within the day’s range for the remainder of the session. There is no major data overnight that might inspire bears to push EUR/USD lower so it’s possible short covering dominates. With the pair holding above the 10 & 21-DMAs short covering risk is upped. Draghi does speak at 09:00 CET tomorrow so there is some danger the pair drops as any remarks he makes on economic risks are likely to be dovish.