The Euro tanks as weak European data hits it, recovers in US trading
According to data released this morning form the Euro Zone the vast amount of troubles that shatter the region's economic recovery are still not behind us. For a full day the Euro was on its back trying to find impetus to recover from its morning slump and at the end it managed to do just that.
Our daily analysis is focusing on the EUR/JPY binary options forex pair and all we can say is that we are impressed with the pace that the single European currency has recovered from the data slump induced by weaker than expected manufacturing surveys in France and Germany.
The main theme this morning has been a substantial rise in the value of the Japanese Yen as the above mentioned numbers have triggered a risk off environment that only started to subside after the US data hit the wires with low inflation numbers and an ongoing recovery in American manufacturing.
The pair has suffered heavy losses to just 139.20 as the European morning unfolded. After the shock was absorbed we have set in for a period of consolidation that culminated in mid-New York trading bringing us to face the harsh reality of unforgiving markets.
The Euro has rallied back up all the way above 140.30 and is currently trading around 140.37. We will be looking for dips towards 140.00 to buy daily calls for tomorrow's last daily expiry for this week. In other words a weekly expiry is fine to be traded as well.
The main condition is that rates don't break below 139.80 as that might cause some covering of long positions and a subsequent fall to retest today's lows. If that will be the case watch out for a break below 139 that would surely trigger some stops and drive prices even lower.