Euro (EUR) On Shaky Ground!
The Euro has pulled back from the top of the range that we identified last week and has since retraced all the way back to the 61.8% Fibonacci level. Having violated that level earlier this morning, a close will be need above 1.3560 in order for there to be a chance to resume the intermediate-term up move. Notice we’re not calling it a trend, as the action has been pretty choppy to say the least.
As the debt crisis persists in the region, it will be interesting to see if the ECB steps up its rhetoric or if the individual countries can get a handle on their deficits. While we will likely to re-test the lows near 1.32, a close above the Fibo line would buy some time for support to step in.
Regardless of which way this goes, it is likely to remain volatile for some time!