The risk aversion direction could contain the investors again pushing the greenback up across the broad in the beginning of the US session while the sentiment towards the single currency remains dovish with no major change of the EU Fin Minister Stance of going forward for bailing out Spain by euros100b will be directed basically for recapitalizing its banking sector while the political stance is still not clear about the ESM and the use of its funds in direct buying of bond waiting tomorrow initially for the German parliament voting on the ESM which was supposed to be started in the beginning of this month while there could be voting against it as this parliament always criticizes the direct bond buying by the ECB which will share as a supervisor and agent in the ESM

The EU fin ministers have announced that there will be 30b of the 100b available by the end of this month for Spain while the Spanish government liability is still not clear to the markets which will be waiting for the new company which will conduct managing the assets of the banks which will be shored up by the European bailing out funds while the single banking supervisor is still under construction also and this is in the same time with no clear picture about the collaterals of these funds which will be for loans its maturities from 12.5 to 15 years.

God willing the market will be waiting tomorrow too for the recent Fed's minutes release to know more about what was behind the recent Fed's decision of extending its treasuries twist operations by 267.5% keeping its same buying monthly scale at $44.4b to detect whether there is a possibility of taking more easing steps soon or not.

God willing, After EURUSD has broken today its previous supporting level at 1.2255 which could stave off its recent falling to get back 1.2333 whereas it has managed to fall again it can meet now another supporting level at 1.2151 and the breaking of it too can open the way for 1.1876 again whereas the pair has rebounded forming its bottom on 7th of June 2010 which drove the pair later to reach 1.4939 on 4th of May 2011 while the pair ascending back way can be met by resisting level now at 1.2332 which can be followed by 1.2402 which has been forming supporting level previously before 1.2543 and its breaking can lead to 1.2693 which has been reached following the recent EU summit before 1.2748 which has been reached after the recent parliament elections in Greece again 3 weeks ago but the single currency failed to continue rising versus the greenback over it while crossing above it can be met by a higher resistance at 1.2822 before the psychological level at 1.30 which its breaking can open the way for more resisting levels at 1.3063, 1.3180 and this can be followed by 1.3281 which its breaking can open the way to 1.3384 again before 1.3489 whereas it has formed its recent top and in the case of breaking 1.3489.

Kind Regards

FX Market Strategist
Walid Salah El Din
E-Mail: mail@fx-recommends.com
http://www.fx-recommends.com