Steve Miley

Tue, Oct 1

Euro under pressure

*  A further selloff for the Euro over the past 24 hours, again to new multi-year lows after
downgrades to the German growth outlook.

*  Negative pressures for the Euro have been increasing over the past week, with EURUSD
selling off more aggressively since the latter September preliminary PMI data last week
for Europe came in very poor.

*  Manufacturing PMI today and Services and Composite PMI data Thursday.

*  This current weakness in the European economy keeps the Euro vulnerable, whilst the
US Dollar is still favoured as a safe haven, which leaves downside risks for EURUSD.


EURUSD: Bear trend extends

A plunge Monday to another new multi-year low after last week’s stall from below 1.0967, to
reinforce the bear forces from the latter September selloff to below the low884s at 1.0926/24,
to keep risks lower for Tuesday.

The late August selloff through 1.1025 shifted the intermediate-term outlook to bearish, BUT
risk is growing for an intermediate-term shift back to neutral above key 1.1164.
For Today:

*  We see a downside bias for 1.0884; break here aims for 1.0862and maybe 1.0839.

*  But above 1.0926 very quickly aims for 1.0948 and then up towards 1.0968.
Intermediate-term Outlook - Downside Risks: We see a downside risk for 1.0839 and

* What Changes This? Above 1.1165 shifts the intermediate-term outlook back to neutral;
above 1.1250 is needed for an intermediate-term bull theme.


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