EUR/USD is currently at 1.2281, barely below
Asia-Pacific open price, retracing from session highs at 1.2306, amid a USD
across the board move up, included against Yen, helped by rising US bond yields,
with 10y back around the 1.8% after 4 months. Local share markets are in the
green overall, with Nikkei above the 9000 points rising some +1.61%, following
US equity markets with SP500 above the 1400, and less than 20 points below 2012
highs, with record year low volumes, and VIX at a 5 year low. EUR/USD is now
about flat for the week.
London session ahead will be another one again
with almost no EUR macro data related to be released, but EU CPI figures at
09:00 GMT as most critical, while in the EZ sovereign debt auctions front there
was a Spanish one that has been canceled. Risk premium between Germany and Spain
fell yesterday to a several days low around the 500bps, with German yields
rising as risk sentiment is improving, and Spanish 10y yields remaining
range-bound below the key 7%. Much worse FDI figures today coming from China
showing a decrease in -8.7% in Foreign Direct Investment (YoY) (Jul) have been
helping the recent rise in USD.
Immediate support for EUR/USD to the
downside comes at current weekly lows 1.2260/4, followed by July 27/Aug 10 lows
at 1.2240, and July 13 lows at 1.2162. For the upside, nearest term resistance
shows at recent session highs 1.2306, followed by Tuesday's lows at 1.2316, and
yesterday's highs at 1.2344.
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