EURUSD, 6/9-6/14

Recap

An epic week for the pair as it burst from under 1.30 to touch 1.33 before settling the week around 1.3225 after Friday's semi-positive US NFP report. A lot of this move has been attributed to leveraged cover buying on an ECB non rate cut on Thursday as well as some firms forecasting no further ECB cuts at all.  I personally would be late to this covering party as I was massively short EUR to start the week, so much so that I certainly would've lost my account had I not covered Thursday.  In any event, I've taken massive losses from this position, but still would not touch the EUR on the long side.

Outlook
I expect the pair to drift until Wednesday when we see inflation numbers out of the EZ.  I'm looking for a distinct deterioration in data to convince market participants that a rate cut is coming in July, and thus a resumption of downtrend into the mid 1.20s.

Economic Calendar
Mon
A light day for both EZ and US data.  An Italian Q1 budget deficit reading at 5am EST should be interesting, but not too impactful on trading I wouldn't think.  No notable US data releases.

Tue
Another light data day.  US wholesale inventories at 10am EST.  German court will begin 2 day case hearing legality of ECBs OMT programme.  This could source volatility even though it is widely expected to be ratified.  If it isn't prepare for pandemonium.

Wed
Inflation data for all major EZ countries.  This will be interesting because forecasts are for slight increases in inflation, while last month's reading showed decreases.  Any big misses here, especially in Germany will surely be processed as fuel for a further ECB rate cut.  Also in the US note the MBA mortgage applications.  These have fallen off a cliff since taper talk has been pushing mortgage rates up close to 4%.  Any sign of a stabilization here could be good news for USD.

Thu
ECB Monthly report out at 4am EST, will provide insight into how ECB is viewing risks to price stability.  Also, weekly jobs data should further shape market participants' views of Fed tapering.

Fri