EUR Trading Outlook (02-12-2014)

EUR/USD The JPY strength post-Japan downgrade by Moody’s sent EUR/JPY spiking lower towards 147.05/10. EUR/USD was dragged along reluctantly ad it hit 1.2419. Bears could push no further though as USD weakness trumped JPY. this saw The pair quickly bounce off the day’s low towards 1.2480 before slipping near 1.2460 as NY opened. More USD weakness and a slump for US bond yields saw that dip bought. A high of 1.2507 was hit. Much of NY’s gains were eroded though after US November ISM beat forecasts. the pair slipped down to the 200-HMA, bounced briefly above 1.2500 again but sat just below 1.2475 late in the day. The pair may chop around in the 1.2350/1.2600 range for the remainder of the week. A fair number of option expiries near the 1.2500 region and upcoming event/data risks (ECB, US jobs data) are likely to keep the pair from staying outside that broad range.