Daily Outlook: After a bit of choppy trading last Friday (the exact reason why we don't trade Fridays) the pair appears to be searching for a clear direction this week with analysts weighing on both sides of the risk on / risk off debate:

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What used to be a relatively clear equation (risk on = higher euro, risk off = higher dollar) has been further polluted by mounting European debt questions and their ability and will to handle those problems, along with the US Governments failure to reign in its own debt. Rumors in the US are that the 'super committee' assigned to reach a compromise on debt reduction are poised to announce failure on Monday morning. We expect such an announcement will initially be USD negative - until traders remember that the news coming out of the EU is worse.

Technically, which is what we ultimately exit / enter, based off of the pair has been in a tight consolidation channel between 1.3550-1.3490 for the past several hours (into last week) and we expect a break above or below this to produce enough of a *pop* to nab some pips off of. The major threat to the trade is just the lack of direction and conviction the markets have right now may chase off investors from holding any one position for too long and cause the pair to range.

Trading Idea: Primary trade is a short on a downside break of of 1.3490 with targets at 3470, 3445, 3420 and 3390 for 100 pips profit. We will also look for a break to the topside of 1.3550 and targets at 3570, 3595, 3620 and 3645 for 95 pips potential.