EUR Trading Outlook (11-12-2014)

EUR/USD The pair held to a relatively tight range in Europe. The top was contained by offers near 1.2400 while the base was defined by bids near the 200-HMA. The pair sat just above 1.2370 into NY’s open. Early action saw bulls apply pressure as broad based USD weakness emerged. A steady ascent took hold and intra-day stops above 1.2400 were run. The lift’s pace was upped after USD/JPY broke below s-t support near 119.65/70. EUR/USD shrugged off EUR/JPY’s slip from near 147.60 to below 147.00 and instead cleared the TL off October’s high and the 21-DMA to make a 1.2446 high. Offers into 1.2450 limited the rally to keep stops just above safe for now. Very little pullback was seen and the pair sat just above 1.2440 late in the day. The charts suggest the recent squeeze has legs as day/week RSIs are biased up after turning from oversold territory. Narrowing yield spreads support the squeeze view as well. EUR/USD bears will need a stellar US retail sales number tomorrow to get the downside back into the market’s focus.