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EUR/USD had a good start after the Irish deal was announced, but the weekend gap was closed quickly and the pair is now falling to fresh lows as contagion spreads. Next support is getting close. Will it stop there? Here’s a quick update on technicals, fundamentals and community trends.

euro dollar contagion November 29

Euro/Dollar around 1.3150

* Post updated 12:20 GMT

EUR/USD Technicals

  • Asian session:  Big weekend gap sent the pair to a struggle around 1.3334, but this was closed quickly.
  • Current Range between 1.30 to 1.3114.
  • Further levels in both directions: Below   1.3114, 1.2920, 1.2722, 1.2587.  Above   1.32, 1.3267, 1.3334, 1.3430, 1.3640, 1.37, 1.3830,  1.3950 and 1.4030.
  • 1.3114 next significant support line.
  • 1.3830 significant higher point – far away now.

EUR/USD Fundamentals –

No European or US indicators today. Later, we’ll have lots of action.

EUR/USD Sentiment

  • Irish deal is better than expected, with an interest rate of 5.8%, but it isn’t clear yet if this will prevent contagion to Spain and Portugal.
  • Elections in Catalonia resulted in a victory for the opposition CiU party, a warning sign for Spain’s PM Zapatero.
  • Spanish 10 year yields jumped to record highs – 5.35%. Also Italian notes are around 4% after a bad auction. Contagion is spreading.
  • Currensee Community: 52% are long , 48% are short- yesterday we had more shorts. These are 1174 open positions in real accounts trading this pair at the moment. The community leans towards a recovery of the Euro.

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