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HISTORICAL DETAILS
% Change
1 Wk -3.29
1 Month -2.73%
3 Months -3.38%
6 Months 7.56%
1 Year 10.39%
52 WEEK
High 1.4940
Low 1.2523
BLOOMBERG MEDIAN FORECASTS
Q2 2011 1.45
Q3 2011 1.44
Q4 2011 1.41
Q1 2012 1.41
DAILY DETAIL
The euro was sold off aggressively across the board overnight, as contagion fears spread through markets. Italy has become front and centre now after fixed income traders sold Italian bonds for the sixth day in a row, with ten-year yields spiking up a further forty one basis points overnight. Credit default swaps also rose a massive 20%, as traders focused on their debt to GBP levels, which at 120% is the second highest behind Greece. In early Asian trade, narrative from the eurogroup meeting hit the wires, although it failed to convince markets that a credible plan was about to be announced. It seems we are to hear in the coming days of a new bailout for Greece, which will involve participation from the private sector. The Financial Times also suggested that the EU will step in and buy Greek bonds in the open market. Despite narrative from officials that they will throw everything at the situation to try and sooth contagion fears, the euro looks extremely vulnerable to further selling pressure despite a big move in recent days. EUR/USD saw some short covering in Asian trade, with the pair rallying to 1.4062. However, it seems traders simply used this as a better level to initiate fresh shorts, with EUR/USD going on to trade through the May low of 1.3970 and hit 1.3929. The 200-day moving average at 1.3909 could come into play tonight. Chris Weston, Australia
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