As markets continue to watch for fall out in the eurozone following Friday’s resignation by the ECB’s economist Stark and weekend press reports suggesting Germany preparing for a possible Greek default.
Range: 1.3502 – 1.3622
Euro-dollar closed in NY at 1.3640, off traded lows of 1.3627. Euro broke under the NY lows to an initial low of 1.3580 within the first ten minutes of Asia trading. Decent demand at 1.3575 provided support and allowed for a recovery above 1.3600, but move quickly met macro supply that extended lows to 1.3550. Recovery back above 1.3600 was aided by Japanese security house demand for euro-yen, the move squeezing out some weaker spec shorts which took rate to 1.3622. Rate reversed during the Asian afternoon, the drop through 1.3550 triggering stops which provided the momentum to fill demand at 1.3530 and break the rate under 1.3500 before touching a low of 1.34949. Offers 1.3550, a break of 1.3560 to expose 1.3595/1.3600, 1.3620 and 1.3650/60. Bids 1.3495/90, 1.3465/60.
Range: 1.5793 – 1.5863
Sterling closed in NY Friday at 1.5880, off lows at 1.5845, and after rate had recovered late NY to 1.5904. Fresh pressure on the euro into early Asian trade Monday, provided added weight on cable to take rate to an early overnight session low at 1.5825 before it recovered to 1.5860. Fresh risk aversion selling, along with cross yen sales, took sterling to an extended base at 1.5820 ahead of the European open. Sterling support remains at 1.5820, stronger into 1.5780 ahead of 1.5750. Resistance 1.5855/65 ahead of 1.5900 and 1.5915/20.
Range: 1,829.00 – 1,852.00
Gold was a mixed bag on Friday opening at 1,870.25 and with Europe taking the metal to highs of 1,886.25. With a fall in commodity prices and some strong profit taking led a sharp fall to 1,823.35 before broad based risk aversion on the back of fears of a Greek default turned the tide for the metal, safe haven attraction quickly resurfacing. Gold bounced back 1,868.85 before closing out the week around 1,857.00. Weekend G7 meetings produced no major results and Asian trade this morning has been mixed with an early fall to 1,842 from highs of 1,863.25 before settling into a 1,843-58 range. Support is seen towards 1,823.00 and 1,793.00 with resistance now up at 1,886 and 1,908.50