Euro slips broadly in New York

The euro slipped on Monday as eurozone data added to concerns over the economy and investors bet on prospects of loose monetary policy until year-end. Sentiment has begun to turn sour on the single currency after a rally in late July and early August. Investor focus has shifted back to the eurozone and away from the US economy.
Euro support dwindled further on Friday after European Central Bank Governing Council member Axel Weber said the ECB should extend its loose monetary stance. Adding to the negative sentiment, a survey of eurozone purchasing managers on Monday showed slower manufacturing growth in the region in August.
The euro "continues to be hobbled by concerns over the economic health of the periphery members, and today's mildly weaker-than-expected results from core Europe have not helped to assuage those worries," he said. In late afternoon trading in New York, the euro was down 0.9 percent against the yen at 107.90 yen after falling to its lowest in nearly eight weeks.
Against the dollar, the single currency was 0.4 percent lower at $1.2660. The euro fell as low as $1.2647 after breaking below its 55-day simple moving average at $1.2677, according to Reuters data. In another technical move, a sell signal on the euro against the dollar was triggered on Monday when the 12- and 26-day moving average convergence divergence indicator moved into negative territory for the first time since July 2.
The MACD, which is used as an indicator of short-term momentum, was last at -0.0018. Technical analysts said the next support level is $1.2605, a 50 percent retracement of the euro's rise from a four-year low of $1.1876 in June to its August peak of $1.3334.
Figures compiled by the Commodity Futures Trading Commission showed currency speculators extended euro short positions in the week ended August 17. Data from UBS AG also showed a drop in net investment flows into the euro zone for a third consecutive week. The dollar was down 0.5 percent against the yen, at 85.22 yen, close to a 15-year low of 84.72 yen hit earlier this month.
Markets were disappointed that a much-hyped meeting between Japanese Prime Minister Naoto Kan and Bank of Japan Governor Masaaki Shirakawa failed to live up to expectations. Both agreed to work closely but offered few clues on whether further monetary easing was possible.