08.01 - EUR/USD trades modestly lower on the day below 1.0950
Retail Sales in the Euro area declined by 0.3% on a monthly basis in November, Eurostat reported on Monday. This reading followed the 0.4% (revised from 0.1%) increase recorded in October and came in line with the market expectation. Other data from the Euro area revealed that the Economic Sentiment Indicator improved to 96.4 in December from 93.8 in November, while the Business Climate Index worsened to -0.45 from -0.39. These data don't seem to be having a noticeable impact on the Euro's valuation. At the time of press, EUR/USD was down 0.05% on the day at 1.0935.
Meanwhile, technical indicators on the daily chart have just started drifting into the negative territory and add credence to the bearish outlook. However, oscillators on hourly charts are already flashing oversold conditions. This, in turn, warrants some caution before placing any aggressive bearish bets. This makes it prudent to wait for a convincing breakthrough monthly swing lows, around the 151.15 region, to confirm a bearish breakdown. The GBP/JPY cross might then turn vulnerable to accelerate the slide towards the 150.65 region en-route the next major support marked by the key 150.00 psychological mark. On the flip side, the 152.00 mark now seems to act as immediate resistance. A sustained strength beyond might trigger a short-covering move and lift the GBP/JPY cross back towards the 152.70-80 region. This is followed by the 153.00 mark, which if cleared will shift the bias back in favour of bullish traders.