EUR/USD trades in the 1.4190 area with US equity markets stabilizing and the sales of USD/JPY and JPY crosses easing. Technically, the stall at the 956.00 area in the S&P may keep traders cautious for fear of another correction before making another run to the topside.
Earnings reports remain surprisingly upbeat but bears are wary of the quality of those earnings as they seem to be largely coming via cost-cutting rather than sales growth. Bernanke’s comments on weak consumer demand being the main risk for the economy, dovetails with the notion that earnings will be hard pressed to see sustained improvement after the cost-cutting reaches its peak. There is only so much you can cut, the logic goes…
Small sellers are seen in EUR/USD at 1.4210 and again at 1.4240, traders report with heavy sales still eyed in the 1.4285/1.43 window.
