European woes continue as Merkel discounts a common European Bond

<p>GBP/USD Range: 1.5452 – 1.5495 Support: 1.5380 Resistance: 1.5650 Sterling is still trading under pressure this morning as the risk trade continues to slide and […]</p>

Range: 1.5452 – 1.5495
Support: 1.5380
Resistance: 1.5650
Sterling is still trading under pressure this morning as the risk trade continues to slide and the market buys US Dollars for safe haven purposes. There is no macro data today so the market will continue to trade on European headlines but technically a close below 1.5545 points to a target of the 2011 low of 1.5270.
Range: 1.3298-1.3351
Support: 1.3220
Resistance: 1.3450
The bearish sentiment continues into Asia after the US holiday with a bearish article in the FT and a common theme from the European leaders. In the post conference press meeting between Sarkozy, Monti and Merkel the German leader reiterated her negative stance on a common Eurobond and refusal to endorse the ECB as a last resort lender. Attention then turned to an Article in the FT that sighted deterioration in market conditions would make it more difficult to leverage up the EFSF to the levels anticipated by European leaders.
Range: 77.12-77.55
Support: 76.80
Resistance: 77.80
USD/JPY enjoyed a better session after the Thanks Giving holiday in the US with importers having stronger demand for the pair as is normally the case on a ‘ Gotobi ‘ day. A slide in JGB’s may have also helped the JPY slide but as the European market dominates proceeding Investors may expect rallies to peter out towards 77.80 as Euro/JPY will be the driver of this market.

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.