Monday April 12, 2010 - 18:46:13 GMT
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Euro Holding Gains in Limited Trade
After gapping up and
pulling back from its high, the EUR USD has settled into a range as
traders await more details about the Greece bailout package. In
addition, traders are waiting for tomorrowâ€™s Greek Treasury bill
auction. Investors want to see whether there is strong demand for
short-term Greek debt or if it is going to have to borrow to keep up
with its financial obligations.
The commodity and equity markets
are giving mixed signals today. Initially, both asset classes rallied
as the Euro broke out to the upside. Some traders feel that this new
agreement eliminates concerns about Greeceâ€™s ability to meet its
short-term obligations. Some even feel that the funding is enough to
ensure that Greece will have enough liquidity to implement its new
austere financial measures.
The GBP USD has given back all of its
overnight gains and is now in a position to post a daily closing price
reversal top. The British Pound piggy-backed the Euroâ€™s rally but
turned negative when it broke off its high. The charts indicate a break
back to 1.5297 is likely over the near-term.
After a sharp
sell-off overnight, the USD CHF has settled into a range at 1.0670 to
1.0568. This market is mirroring the movement in the Euro. A strong
Euro will drive the Dollar/Swiss lower.
Mixed equity markets
are triggering a so-so trade in the USD JPY. Stronger equity markets
will increase demand for higher risk assets which will put pressure on
the Japanese Yen.
The USD CAD is trading flat at the
mid-session. The lack of direction in gold and crude oil is
contributing to trader indecisiveness. Technically, this market is
oversold and getting support from the confirmed reversal bottom at
.9975. A break in gold and crude oil will likely drive this market
higher to the 50% level at 1.0138.
A worse than expected housing
market outlook is putting pressure on the AUD USD at the mid-session.
Overnight this pair rallied sharply higher on increased demand for
higher risk assets. After the bearish report, the Aussie sold off,
putting it in a position to form a closing price reversal top.
similar pattern is developing in the NZD USD as traders sold this
market in reaction to the move in the Australian Dollar. At the
midsession, the Kiwi is finding short-term support at a 50% level at
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