Overall, the currency market was unable to find a clear direction in the European session. Except for the pound and for the aussie, the major pairs traded in a tight range after the London open. However, the support and resistance areas may come under pressure, as the economic calendar holds some top tier releases.

The Euro (Eur/Usd) has traded flat, without any clear direction and on low volume during the overnight session. The euro traded in a 40-pip range, but tried to move lower during the European session. The move was retraced in quick fashion, and the euro enters the U.S. session trading within the same range.

The German IFO business climate continued to decline in March, reaching a 26-year low. The index dropped to 82.1, after the index rose for the first time in the last six months in February. The IFO business climate continues to deteriorate as Germany is starting to feel the effects of the credit crisis on a larger scale.

The Pound (Gbp/Usd) shed approximately 100 pips in the overnight session. The pound tried to break lower during the Asian session, but found support at the 1.4650 area. However, the pair broke, with relative ease, below the support level during the European session, and continued its decline.

The Aussie (Aud/Usd) moved lower from the first few minutes of trading. During the European session, the pair fell as low as TheLFB S1 (0.6915), testing the support area of the last few days of trading. Also during the European session, the Governor of the RBA discussed the necessity to regulate the Australian “payment system”, something that might have influenced the pair.

The Cad (Usd/Cad) struggled to break above the high of the last day of trading during the Asian session, but failed. Eventually, the cad broke higher, after the London open, but still the pair still struggled to move much higher. Yesterday, the pair rose for the first time in the last nine days of trading.

The Swissy (Usd/Chf) was again unable to develop a decent trend as the pair traded in a tight 30-pip range during the overnight session. It looks like the swissy has returned to its old patterns of trading, after, in the last few weeks, posting some strong rallies.

The Yen (Usd/Yen) headed higher in the first few minutes of trading during the Asian session, but gave up the gains as soon as it hit Tuesday’s U.S. session high. During the overnight session, the yen traded in a 40-pip range, just below the neutral pivot point (97.85).

The Japanese trade balance came in at -0.04 trillion as the country saw a surplus in February. This is the first time in the last five months that there has been a surplus seen. Exports declined a record 49.4 percent from one year ago as global demand for products diminish due to the current financial slump