The Euro had another subdued trading session where the shared currency held steady despite broad-based US Dollar strength. EUR/USD traded to an overnight high at 1.08964 before slipping to a New York close at 1.0818, down 0.25% from yesterday’s 1.0848. Euro area data saw Eurozone Industrial Production fall to -11.3% in April from March’s -0.1%. While production fell, it was slightly better than expectations of a -12.3% fall. The drop is still huge. There has been an absence of Euro area reports this week, but Friday sees Germany’s Q1 GDP report which could be huge for the Euro.
We reported the net speculative long Euro bets were trimmed to +EUR 76,299 contracts in the week ended 5 May from the previous -EUR 79,681. That is still a huge number of Euro long bets. Market positioning could eventually break the back and a downside break is in the making.
EUR/USD has immediate support at 1.0810 followed by 1.0770 and 1.0720. Immediate resistance can be found at 1.0850 and 1.0900. The next resistance level lies at 1.0950. Look for a likely range today of 1.0785-1.0885. Prefer to sell rallies .