The EUR USD rose to its highest level in more than a month after a strong debt auction in Spain relieved investor concerns about the county's ability to tap capital markets for investment. The rally took the market to 1.3116, the highest level since August 11, as investors perceived the success of the Spanish auction as a sign that the country's sovereign debt issues from the spring were subsiding.

After the initial thrust to the upside through a key technical area, the Euro has traded in a range. Partially responsible for the rangebound, choppy trade was the mixed results from U.S. economic data on manufacturing, jobless claims, wholesale prices and capital inflows.

Technically, a strong surge in upside momentum this morning drove the Euro straight through a Gann Angle/Fibonacci Level Cluster at 1.3044 - 1.3049.

With the market up over .0400 since the recent bottom at 1.2644, investors may not chase this market higher, but may instead opt to buy dips back to 1.3049 - 1.3044 as sometimes old resistance becomes new support.

The strong surge to the upside and the cautious follow-through rally may be an indication that today's move was exhaustive in nature, however we are not going to know that unless the 1.3049 - 1.3044 cluster fails to provide support. In addition, a closing price reversal today will be a strong indication that this rally is over at least in the short-run.

A failure to hold 1.3044 will be a sign of developing weakness.

The USD JPY is up on Thursday, but trading has been slow and rangebound. Trading has slowed to a crawl as investors assess the impact of Wednesday's intervention and the outlook for further Yen selling from Japanese officials.

Many feel that the Japanese government is not finished weakening its currency and are unwilling to step in the market on either side until there are signs of breakout in either direction. A small group of traders seem to be willing to buy the support and sell the rallies while the market remains inside of its tight range.

The daily chart indicates the possibility of a wide trading range for the Dollar/Yen with 84.74 to 84.38 a possible downside target and 88.93 a potential upside target.