A: A little bit, so long as we hold below this little trendline in EUR/USD and below 1.3670. If we break above that level we probably retrace toward 1.3765.
I’m of the opinion, from a fundamental standpoint, that the bailout packages are paying rapidly diminishing returns in supporting the euro.
We see that Greece is struggling to make its austerity targets and that EU partners are queasy about making bailout payments. I don’t think it will be long before Ireland and Portugal will be in the same boat. Restructuring makes more sense than rescheduling debt, so overall I remain medium-term bearish, short-term cautious.
1.3535, the 50% retracement of the rally to 1.4283 is the key support below the market. We bounced from there earlier this week.