EUR Trading Outlook (24-11-2014)

EUR/USD was broadly crushed in Europe’s morning after ECB Chief Draghi showed deepening concern over price stability. EUR/USD dived from 1.2553 to 1.2415 before bouncing ever so slightly into NY’s open. Early NY saw a lift to hourly resistance near 1.2440 but bears were waiting and the pair slid again before pausing briefly ahead of 1.2400. The drop resumed as EUR/JPY added to overnight losses once the pair broke cleanly below 146.30. EUR/USD took out 1.2395/00 support and ran stops. A low of 1.2375 was then hit. A bit of late day profit taking from USD longs allowed the pair a bounce towards 1.2390 and the pair sat there towards the close. The pair couldn’t hold above the 10 & 21-DMAs and a bearish engulfing candle formed on the weekly charts. This suggests the long-term bear trend is close to resuming. A break below 1.2350/60 will confirm that view. Bears then target the mid to late Aug 2012 lows near 1.2240/95 initially. A break there puts the 2012 low at 1.2042 in play.The US has a large line up of data risks next week. If results are upbeat EUR/USD should trade heavy again.