Today is Thu, May 25, 2017 8:41:22 GMT
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Currencies EUR USD News Euro (EUR) Erases Yesterday’s Gains!

The markets giveth and then taketh away.  Yesterday’s gains in risk assets have been erased as the markets are trading lower on renewed fears over the Euro debt crisis.  While nothing “new” has materialized between yesterday and today, this goes to show the awesome effect of the debt crisis on global markets.

News out of Europe this morning focused on lower CPI expectations which some in the market believe will allow the ECB to further ease monetary policy, and also on the issuance of debt from the EFSF tomorrow. Germany’s bond offering was met with less than average demand and overall the markets are concerned about the ability of European countries to service their debt and whether or not credit downgrades may be coming.

So we are likely to see this type of volatility until actual events shape the direction of the trend.  But for right now, the overwhelming sentiment is that the Euro is in trouble so it will take some major good news to reverse this view.

For right now though, if the Euro can avoid breaking through the December lows and stay above 1.285 then we could see a bounce though the range appears to be narrowing until more clarity emerges.  So we will continue to trade the range, looking for an entry closer to 1.2850 to get long with a stop just below.