Germany and France have given themselves an additional four weeks before a conclusive response to the structural defects in European banks are addressed

<p>After being at odds on how best to tackle the enormous task of recapitalizing the European banking sector, Germany and France have given themselves an […]</p>

After being at odds on how best to tackle the enormous task of recapitalizing the European banking sector, Germany and France have given themselves an additional four weeks before a conclusive response to the structural defects in European banks are addressed.  

EURUSD
EUR/USD
Range: 1.3394 – 1.3489
Support: 1.3340
Resistance:1.3500
Euro-dollar opened lower from the NY close of 1.3385 slipping in early Asia to 1.3355 as clarification of the weekend Merkel/Sarkozy meeting which announced a deadline to recapitalize European banks by Nov 3. The Belgian government announcement that it would guarantee Dexia’s Belgian operations also added to the risk returning. Asian markets then picked up with some early strong gains tripping stops through 1.3425 to 1.3468 in thin volume trade, before settling around 1.3455. Talk of some semi-official offers now ahead of 1.3500 with stops seen on a break of the level. Strong technical support is now pitched at 1.3340. he market remains quite illiquid in Asia due to Japan and Taiwan holidays. NY is shut today as the US observe Columbus Day.
GBPUSD
GBP/USD
Range: 1.5545 – 1.5624
Support: 1.5550
Resistance 1.5650
Cable opened in Asia at 1.5530 and eased lower to 1.5528 in tandem with the euro-dollar before picking up on relief rally in equities as the market eventually reacted to the Merkel/Sarkozy pledges and the Belgian governments guarantee announcement over Dexia Belgium. Cable pulled higher to 1.5617. Euro-sterling picked up from early lows of 0.0.8590 but stalled into offers at 0.8632 before easing back to 0.8618. Cable stops are apparently set on a break down through 1.5550 and 1.5500. Offers remain towards 1.5650. Cross support is seen at 0.8590 ahead of stronger at 0.8530/35. Resistance is seen at 0.8670 ahead of stronger at 0.8710/15.
Gold
Range: 1,644.82 – 1,653.97
Support: 1,626.00
Resistance: 1,667.00

 

Gold prices were mixed on Friday with the metal closing the week at 1,638, up on the week but down on the day. Gold opened at 1,651 but fell as risk returned through equity markets, leading the metal down from early highs of 1,666.60 to lows of 1,626.25 in the NY afternoon session. Asian markets this morning have seen some bargain hunters appear and a rally to 1,654.10. Silver has also started the week on a bid tone with a rally to 31.98 in Asia after closing last week at 31.15. Gold support today is at 1,626 and 1,598 with resistance towards 1,667 and 1,679. Silver support is at 30.72 and 30.27 with resistance at 32.82 and 33.55
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