Euro Rises, But Stuck Under Resistance

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EUR/USD is struggling with a minor resistance line, riding on drops in troubled countries’ bonds (especially Spain) and a better than expected retail sales figure. . Update.

The yields on Spain’s 10 year government bonds are falling for a third day in a row and they are now at 4.99%, just under the round number of 5%.

At their peak earlier this week, they reached 5.6%, but have fallen on the hopes that the ECB will buy bonds. Indeed, Trichet fooled everybody and bought bonds – while he was speaking and boring the reporters at the ECB press conference, the ECB was grabbing lots of bonds – those were bonds of Ireland, which has been already “bailed out” and Portugal, which is marked as the next domino.
As long as Portugal doesn’t get aid, Spain is relatively safe. Spain is the Euro-zone’s fourth largest economy, and is too big to bail.

EUR/USD is now at 1.3264, just under 1the 1.3267 line. Next resistance is at 1.3334. Support is at 1.32. For more technical levels and analysis, see the EUR/USD forecast.

More good news came from the all-European retail sales figure – it came out slightly better than expected, a rise of 0.5% instead of 0.4%, with an upwards revision of last month as well – a drop of 0.1% instead of 0.2% initially reported.

The market is tense towards the US Non-Farm Payrolls due at 13:30 GMT. Here’s the NFP Preview.

Lots of action ahead…

The 1.3267 line is very important to watch at the release of the Non-Farm Payrolls.

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Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

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