EUR back above 1.25, Gold, Silver follow

The Euro is not just back above $1.25 in mid-day trading after the European stock markets have closed for the day

It is approaching 1.26 and the implied market chatter could put the Euro within striking distance of the 3-month highs of 1.27.

While this is still cheap compared to recent years, it was just on 15 August that the low was under 1.22 and it was in July where we momentarily saw the Euro challenging 1.20 on the downside.

With Ms. Merkel back from vacation in Germany and speaking with Mr. Samaras Friday, Mr. Samaras has pledged to make good on Greek debt but with more delays.

Now the question is Spain over whether or not it will finally capitulate and ask for a formal bailout in the 2nd week of September.

The CurrencyShares Euro Trust (NYSEMKT:FXE) is up almost 0.45% at 125.02 and is back at the highest levels seen since 3 July. If the USD is weakening, you know that is driving commodities higher:

Gold is higher by $9.71 to 1672.82 and that has the gold ETFs higher with the SPDR Gold Shares (NYSEMKT:GLD) is up 1.1% at 162.30 and the rival gold ETF of the ETFS Physical Swiss Gold Shares (NYSEMKT:SGOL) is up 1.04% at 165.32.

Oil is higher as well despite stock prices being down with a barrel + 0.48 at 97.74 so far today and that in turn has the United States Oil (NYSEMKT:USO) up 0.44% at 36.38 on the day.

Watch the currency markets here, with that being the EUR in particular. At some point a stronger EUR will not just be Bullish for commodities.

All of those US companies which warned that currencies were hitting their returns negatively could stand to benefit.

Paul A. Ebeling, Jnr.

Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster's Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.

Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.