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The important  ZEW Economic Sentiment disappointed and instead of rising, it dropped. The indicator was expected to rise to -9.9 but dropped to -15.7 points. Last month’s figure was -11.5. The negative numbers represent pessimism.

EUR USD Lower after weak ZEW November 13 2012
EUR USD Lower after weak ZEW – Click image to enlarge

EUR/USD tests 1.2660 and digs lower in two month lows. 1.2624 is next.

The all-European figure also disappointed and fell from -14. to -2.6 points. A small rise to positive territory was expected.

The ZEW think-tank says that there are recessionary developments in the euro-zone and this is a burden on Germany. This joins Draghi’s statement that Germany is beginning to feel the euro-zone pain.

Earlier, the euro dropped as the Eurogroup didn’t decide on more aid to Greece. It left 4 big issues wide open for Greece.

EUR/USD is now stabilizing at 1.2670. Weak resistance is at 1.2690, followed by more significant resistance at 1.2750.

On the downside, the January low of 1.2624 is strong support, followed by 1.2590. For more see, the euro to usd forecast.