Grexit Speculation Intensifies
City Index May 25, 2012 1:00 PM
<p>Grexit Speculation Intensifies. Even though EU officials failed to reach an agreement on the issue of Eurobonds during the Wednesday summit and despite the increase […]</p>
Grexit Speculation Intensifies. Even though EU officials failed to reach an agreement on the issue of Eurobonds during the Wednesday summit and despite the increase on the speculation on the possibility of Greece leaving the Eurozone, European were in a corrective moment yesterday.
Range: 1.2519 – 1.2566
Euro-dollar closed in NY at 1.2532 following a recovery off 1.25205, with the rate seen lows of 1.25153 earlier in Asia. An aggressive buyer in early Asian trade, took the rate to a high of 1.2555 in its effort to trigger stops. Strong dollar-Asia demand emerged again and led to general dollar demand which pressed euro-dollar down to 1.2518, with market probing for stops, rate recovered ahead of the European open, touching 1.2542. Strong option related demand remains in place ahead of the much reported barrier at 1.2500, stops are noted below the figure, though larger ones are seen through 1.2480-1.2475, with 1.2480 noted to hold one touch option interest, and below 1.2450. Resistance seen at 1.2550-1.2555, a break to open a move toward 1.2580-1.2585 ahead of 1.2595-1.2600 and 1.2620.
Range: 1.5648 – 1.5676
Cable closed in NY at 1.5669 after recovering off a late pullback low of 1.5648. Rate tracked euro-dollar moves, pushing up to an early session high of 1.5674 before reversing to retest that NY low, while euro-sterling was contained by 0.80005-0.8011. Cable retains a negative feel into early Europe, extending lows to 1.5647 and holding heavy, with dollar demand seen as the driver. Support seen around 1.5639 with a break below to open a deeper move toward 1.5610-1.5600. Further demand seen at 1.5580 ahead of 1.5550. Resistance noted at 1.5674 ahead of 1.5687 and 1.5700-1.5710. For the cross, bids remain in place from 0.8000 down to 0.7995, a break of 0.7990 to expose next support at 0.7985-0.7980.
Range: 1551.70 – 1562.95
Gold prices were higher despite a decline in the Euro with a backdrop of poor economic data main support at 1,525.00 intact. Emerging market central banks continued to acquire gold in April, according to the IMF; official sector demand for bullion as a portfolio diversifier is a supportive case for gold. Again gold held a tight range overnight 1551.70-1562.95. Support now seen at 1,551.90 followed by 1,545.69 and then 1,535.62 resistance looks at 1,572.04, 1,578.25, and a move higher to 1,588.32.