EUR/USD: 1.3320There is not a whole lot to add on the Euro today. It is 20 points lower than yesterday, having traded 1.3318/85 over the course of the session
The Case Schiller Home Price Index showed that home prices remained unchanged in January. This was the first time they have not dropped since last July, suggesting that prices may be stabilising. Elsewhere the US data was on the soft side today with The Conference Board’s Confidence Index dropping to 70.2 in March from a revised 71.6 reading the prior month. US Treasury yields fell to 2.203% in the 10′s. Equities finished quietly with the S+P down 0.28% @ 1412.51.
In Europe we are now awaiting the EU Fin Min meeting on Friday, at which the “Firewall” to protect the EU from further crises, will be discussed. The OECD are looking for this to be Eur 1 Trillion. Germany won’t be happy, and this could see some volatility in the Euro, but ahead of that it looks as though the Euro could remain fairly rangebound in the absence of any major data.
The upward momentum of the previous two sessions in the Euro looks to have dissipated somewhat, and the 4 hour charts are mildly overbought. For the coming session, Asia at least, 1.3300/70 looks as though it should easily cover it. Further out, rising trendline support is now at 1.3240, with the 50% pivot of the move from 1.3485 -1.3002 also coming in at 1.3242. On the topside, the day’s high at 1.3385 will be the first hurdle. Above there, 1.3420 and 1.3585 will provide resistance. The price action looks to be pretty neutral right now, and with little going on it could be that we get a 24 hour sideways drift.
One thing to note is that the Dollar Index (DXY) broke the 79.00 support today. It is currently back at 79.03, but the daily MACDs have crossed lower and suggest the possibility of further dollar weakness in days to come. We shall see.
Today, data sees German CPI & US Durable Goods, but that aside, it is going to be quiet on the data front.
One thing to keep an eye on though, is that Bernanke will be interviewed on US TV this morning in Asian time. This doesnt happen often and will be carefully monitored and may add a bit of volatility in what should otherwise be a quiet session.
Expect a range trade in 1.3290/1.3390.
