SpotEuro Forex Daily Outlook May 10, 2010

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Happy Monday Traders, Wolfpack behavior - Those are the words used to describe the current price action by Anders Borg, Finance Minister of Sweden. It is still very unclear as to what will happen over the next few weeks. Will the EZ get its act together and will the markets regain confidence in the euro? Will there be another panic driven sell-off that may be triggered by a similar situation in the near future? Or has this panic driven sell-off ended? We wont know until later this week. At this time, an hour before Asian markets open, the euro has gapped to a higher open of 1.2840. Is this a sign of stabilization or will we see fear come back into the market during London and NY trading? Again, this is a time in the markets that good technical and fundamental analysis will be overshadowed by wolfpack behavior. We will be focusing on very short term trades until we see the market stabilize.

Update: (EU) EU draft to offer €600B to Eurozone stability fund in loan guarantees; €440B to come from EU members, €60B from Eurozone budget, €100B from IMF.

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