AUD/USD: 0.9185EUR/USD: 1.3340The Euro finished the week on a quiet note in a relatively data-free session, allowing the focus to remain on the timeline that the Fed will follow in order to begin withdrawing the current injections to its QE programme. Ongoing comments from various Fed board members that it could commence as soon as September kept the dollar underpinned going into the weekend, although the Euro does look as though it has the potential to give the resistance in the 1.3400/30 are a good run for its money over the course of the coming week.
There will be a fair bit of data to provide direction, although Monday looks very thin, so it could be a quiet start and a range of 1.33/1.34 would be of little surprise. The 4 hour charts have turned a little lower and if we break down below the nearby, rising trend support at 1.3320, we could see a run towards the congestion in the 1.3280/1.3300 area, below which would suggest a run to 1.3245 Fibo support (23.6% of 1.2754/1.3400). Below 1.3200 would see a decline to 1.3155 (38.2%) but looks unlikely for the time being.
If the Euro can overcome 1.3400 (200 WMA) it will run into resistance at 1.3415 (19 June high) and then at 1.3430 (100 Month MA). Above here would trigger plenty of stops towards 1.3477 (76.4% of 1.3710/1.2753) and then there is not a whole lot to stop it heading back to 1.3710 (1 Feb. high).
As we have previously said, 1.33/1.34 may cover it for now. We are leaving a sell order at around 1.3420 with a reasonably tight stop at around 1.3480, looking for a return to 1.3300 and below, which could arrive quickly if the tapering talk gathers speed.
Economic data highlights will include:
M:
T: German CPI, EU/German ZEW, EU Industrial Production, US Retail Sales, Business Inventories
W: German GDP, EU CPI, GDP, US PPI
T: US CPI, Jobless Claims, NY Empire State Mfg Index, Industrial Production, Capacity Utilization, Philly Mfg Survey
F: US Building Permits, Housing starts, Rts/Mich Consumer Sentiment Survey
