The euro (Currency:EUR) has fallen in line with the dismal sentiment being expressed on the global financial markets.
These negative conditions are likely to hurt the risk-prone euro and high-yield currencies such as the CAD, AUD, NZD and ZAR.
This morning's poor out-turn in Europe follows on from negative action in the US overnight:
"A higher than anticipated rise in the US jobless claims figures following the damages done by hurricane Sandy sparked another plunge in equities. Consequently, the Dow Jones continued its decline yesterday, dropping another 24 points to 12,556 and reaching a new recent low in the process. The downward trend is firmly intact with bargain hunters still holding back for the moment," stays a market comment from Capital Spreads.
Looking at the spot currency rates:
The euro dollar exchange rate is 0.34 pct in the red today, EUR/USD is at 1.2735.
The euro pound exchange rate is 0.31 down at 0.8030.
The euro Canadian dollar rate is 0.29 pct lower at 1.2758.
Technical forecasts for the euro:
UBS are Neutral on the EUR/USD saying, "with Stochastic momentum crossing sharply higher, our focus shifts to resistance at 1.2876 ahead of 1.3023. A move below 1.2700 will take the pair towards 1.2662."
Trading Central are bearish on the euro on a short time frame, "EUR/USD intraday: turning down. Pivot: 1.28. Short positions below 1.28 with targets @ 1.2715 & 1.2695 in extension."
Jyske Markets also show little optimism for the euro:
"We still point out the idea of buying a 14-day EURUSD call option (previously we also mentioned as a buying opportunity EURJPY, but for this cross rate we have already seen a very strong upward movement, so therefore EURUSD should be preferred). A 14-day EURUSD call option, strike 127.75, costs about 0.5% (spot ref. 127.55)."