A new week starts, with dollar appreciating against its major counterparts and EUR/USD making another dive towards 1.38 as a result. The G8 meeting was enough to spark new worries about the global crisis and although the message was that the big economies may start to recover soon, Ministers indicated they may start to withdraw money out of the stimulus plans as the economic recovery progresses. The greenback is enjoying some gains after market opening on the back of Russian Finance Minister€™s comments who basically re assured investors that US dollar was and still is the world€™s main currency and they should have more confidence towards the buck!

The EUR/USD continued to slump after European morning and the fact that pair rejected 1.40 once again makes euro€™s rally more difficult to be sustained in the coming days. Next level to watch now is 1.3830 and if that gives way then the pair may continue its slide towards 1.37. The euro bulls need to keep the important support levels untouched and if they do so, the current dive may be reversed as dollars future looks gloomy also.

The economic calendar is almost empty today, with only important data out of US being TICS data later on and Empire State Manufacturing Index. Investors have indeed returned to basics lately and fundamentals seem to work, however the risk aversion is always a reality when things start to go south. Only last week the stocks, equities and commodities were positive, with oil printing yet another high above $72, however come Monday and the gains seem to be fading away along with investors new found confidence.

The fact remains that a lot of geopolitical issues are of concern to global leaders lately, with swine flu being back on the media radar, Iran€™s latest elections hazard, and the need of G8 Leaders to create synchronized €œexit strategies€ in order to keep the recovery from retreat. Investors know that the next months will be crucial for all markets direction and try to keep a low profile until further signs of recovery hit the news wires.

Let€™s see how New York will open and if this week will be another positive one which will give traders optimism that from now on, economic numbers may start to stabilize and employment sector may be nearing bottom. The real problems may start after the inflation numbers confirm what everybody fears now, high inflation in these economic conditions which will only complicate things even more. For now, EUR/USD needs to keep 1.38 ahead of 1.3760 intact and GBP/USD need to be trading above 1.6250 if there is further hope for gains towards 1.65 again€¦