Euro rebounds against majors, except the yen, with some hopes in markets, following successful bonds selling in Italy and Spain last week, before France auctions debt.
Meanwhile, there are some hopes that an improvement in the French auction would overshadow the bearishness after S&P cut to several euro area economies, including the AAA-rated France and Austria.
France aims to auction 8.7 billion euros at 3 p.m. Paris time today, yet the euro remains under pressure as the European Financial Stability Facility (EFSF) is at risk of facing a similar downgrade to its top rating and may face a reduction in its lending capacity of the EFSF to 180 billion euros.
Moody's, the rating agency, said on Monday that the French debt ranking is under pressure, where the agency clarified that the French rating will be updated later this quarter.
This week the EFSF is set to auction 1.5 billion euros of six-month bonds in the first test after the S&P cut.
Also, this week Greece will resume talks with private sector debt holders, specifically on January 18 after the halt of the negotiations on January 13, to reach an agreement over the size of losses to be bared by creditors to avert a possible default as early as in March.
Greece has to first convince private sector debt holders to accept 50% haircut of the debt then secondly it has to start a 4-year convincing and decisive plan for the IMF and EU in order to become eligible for receiving the second bailout worth 130 billion euros.
Concerning the EUR/JPY pair, it is currently doing attempts to rebound from 11-year low, after opening on a gap, to trade around 97.30 after recording a high of 97.42 and a low of 97.01.
The trading range for the week is expected among the key support at 96.10 the key resistance at 99.00.
Against the franc, the euro is showing decline after the S&P cut and amid expectations the SNB would intervene to protect its 1.20 cap announced in September as the pair currently trades around 1.2090.
Moreover, the dollar index, which tracks the dollar movements versus a basket of major currencies, fell to touch a low of 81.39 compared with the day's starting level of 81.68.
Moving to the GBP/USD pair, it rose on the daily charts, following the general trend in the market amid the absence of fundamentals from both economies.
The pair is currently hovering around 1.5312 while recording a high of 1.5328 and a low of 1.5275, while The trading range for this week is among key support at 1.4975 and key resistance at 1.5680.