EUR/USD Feb 26 – Plunges as Italy Faces Deadlock



EUR/USD dropped over a cent in Monday trading (February 25th), following the results of the Italian parliamentary election. The results were a huge surprise, as the 5-Star Movement, headed by  a former comedian, won the most votes. With no party winning a clear majority, Italy faces political deadlock, as politicians scramble to put some type of coalition together. There are no Eurozone releases on Tuesday, but the markets in the US will be busy, as there are three key releases on schedule. Federal Reserve head Bernard Bernanke testifies before the US Senate Banking Subcommittee in Washington. As well, CB Consumer Confidence and New Home Sales will be released later on Tuesday.

Here is a quick update on the technical situation, indicators, and market sentiment that moves euro/dollar.

EUR/USD Technical

  • Asian session: Euro/dollar was fairly steady, consolidating at 1.3060. In the European session, the pair has moved higher, pushing back above the 1.31 line.
  • Current range: 1.3030 to 1.3110.

Further levels in both directions:  EUR USD Daily Forecast February 26

  • Below: 1.3030, 1.30, 1.2960, 1.2812 and 1.2758.
  • Above: 1.3110, 1.3130, 1.3170, 1.3255, 1.3290, 1.3360, 1.34 and 1.3486.
  • 1.3030 is providing support.
  • On the upside, 1.3110 is a weak resistance line.

Euro/dollar edges higher after sharp losses following Italian  election – click on the graph to enlarge.

EUR/USD Fundamentals

  • 14:00 US S&P/CS Composite-20 HPI. Exp. 6.7%.
  • 14:00 US HPI. Exp. 0.6%.
  • 15:00 US CB Consumer Confidence. Exp. 60.8 points.
  • 15:00 US Fed Chairman Bernard Bernanke Speaks. Bernanke will testify on the Semiannual Monetary Policy Report before the Senate Banking Committee.
  • 15:00 US New Home Sales. Exp. 381K.
  • 15:00 US Richmond Manufacturing Index. Exp. -4 points.

For more events and lines, see the Euro to dollar forecast

EUR/USD Sentiment


About

Kenny Fisher - Senior Writer

A native of Toronto, Canada, Kenneth worked for seven years in the marketing and trading departments at Bendix, a foreign exchange company in Toronto. Kenneth is also a lawyer, and has extensive experience as an editor and writer.

No Comments

    Read previous post:
    Euro down falling
    Market Overwhelmingly Oversold – Chance of Short Covering

    Well I guess traders didn’t like the outcome of the Italian elections. After falling hard through...

    Close