The euro gained traction across many of the majors on Monday, gaining more than 1 percent against the US dollar and Japanese yen as risk appetite increased and as Euro-zone manufacturing PMI for the month of July was revised higher. Indeed, PMI was revised up to a nearly one-year high of 46.3 in July from previous estimates of 46.0 and from 42.6 in June, suggesting that the sector continues to see signs of recovery. On the other hand, German retail sales for the month of June unexpectedly slumped 1.8 percent, suggesting that any improvements in demand for European goods may be due to foreign demand, rather than domestic demand. All told, the EUR/USD break above the former 2009 high of 1.4340 creates potential for additional gains, with 1.4600 (61.8% fib of 1.6036-1.2328, weekly/monthly pivot point) offering the next solid level of resistance.
Related Article: Euro Weekly Trading Forecast
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