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A bearish Monday indeed! The EUR/USD drops 100 pips, slicing through two supports.
The S&P 500 seems to be recovering from the previous dip. However we seem to face resistance around 1115. Therefore it is good to be prudent and see if the S&P500 will range like the EUR/USD.
Oil remains around $77. Not much of an issue there for now.
Gold trades around $1113. Facing pressure from the US Dollar and uplift from demands due to possible risk aversion.
The main highlight of the day?
Reports state that Germany is not factoring Greece aid into the budget for 2010. Investors are probably dismay at this as previous speculations include Germany’s bail out for Greece. It is interesting how these speculations work. One moment Germany seems to be helping, next moment not. Later again it seems but yet a while later not. This ding dong is, my friend, the dynamics of a free market. Driven by speculations, sentiments and expectations.
Remember the advantage of forex is that we can ride both sides of the wave! Making money in forex is possible if you play your cards right!
I was reading an article that suggests that Britain may be next after Greece. Britain had been selling great amount of debts and investors may focus on this one day. Furthermore, it was mentioned that the GBP may weaken against the US Dollar as a result of this.
The Euro Zone is a troubled zone.
Over across the Atlantic, the challenges still remain for the US. Unemployment remains a problem, and the budget deficit of US is a big amount. Recent economic data from the US shows a mixture of performance. This suggest that some form of recovery may be happening, but it is fragile.
I mentioned that these days, the comparison of the Euro Zone and US would be one of who is worst off. This seem to be indeed so for now as negative data often drives movement of the currency pair.
We have a rather light on data day tomorrow. However we do have a few due including the Consumer Price Index Flash Estimate that may shed some clues on the Euro Zone’s health.
Bullish relief may see us back at 1.3550/600.
Further bearish onslaught may bring us to 1.3455/00.
I had a fulfilling day today! Did many work. No blues in sight. However i am tired now. I forced myself to have a date with Ms Sleep yesterday and i intend to do so again today.
Wherever you are in the world, take good care and trade safely
Read more Forex Articles and Views by The Koala at www.thegeekknows.com