The Euro remains within choppy consolidation after initial attempt above 1.2300 barrier failed.
Price action is holding in red on Tuesday, descending from Asian session high at 1.2275 and moving in the lower side of 1.2213/75 congestion on hourly chart.
Further easing could violate initial support at 1.2213 and expose 1.2192 (top of thickening 4-hr cloud which underpins near-term action), break of which would risk test of key near-term support at 1.2165 (consolidation range low).
Overall picture remains firmly bullish and sees scope for further advance, but looking for a catalyst to spark fresh action.
Today’s German/EU ZEW economic sentiment reports are the first events which could stronger influence Euro’s near-term action, followed by EU Consumer confidence and key event for the Euro this week, ECB’s policy meeting on Thursday.
Forecasts show ZEW numbers higher in Jan (17.8 f/c vs 17.4 previous – Germany and 29.7 f/c vs 29.0 previous – EU) but the figures are lower from the same period last year.
EU’s consumer confidence is forecasted at 0.6 in Jan vs 0.5% in Dec, which will be the second positive reading since Jan 2001.
Overall bullish techs remain supportive, however, further easing cannot be ruled out as daily RSI is turning south after holding in sideways mode in past few days and slow stochastic continues to trend lower.
Key supports lay at 1.2182 (rising 10SMA) and 1.2165 (consolidation floor) and sustained break here is needed to signal further easing.
Res: 1.2275, 1.2296, 1.2323, 1.2360
Sup: 1.2213, 1.2200, 1.2182, 1.2165
