The euro is getting punished versus major currencies as concerns linger about a possible downgrade of European debt

<p>Friday’s agreement by European leaders is being viewed as an attempt to safeguard the eurozone from possible downgrades. GBP/USD Range: 1.5554 – 1.5655 Support: 1.5562 […]</p>

Friday’s agreement by European leaders is being viewed as an attempt to safeguard the eurozone from possible downgrades.

GBPUSD
GBP/USD
Range: 1.5554 – 1.5655
Support: 1.5562
Resistance: 1.5665

Cable closed in New York at 1.5665 on Friday, with the rate drifting off from that level through to Asia, trading to a low of 1.5628 ahead of the European open. Early Europe extended the move to 1.5622. UK’s use of its veto to block the EU Treaty change has been seen by some as isolating the country in the EU, leaving markets to analyse the consequences. Support appears to be at 1.5562 and then seen to expose 1.5542. A break here to open a deeper move towards the 1.5510 area. Resistance currently seen at 1.5665, 1.5717 and then 1.5753.

EURUSD
EUR/USD
Range: 1.3302 – 1.3377
Support: 1.3300
Resistance: 1.3385

Euro-dollar closed in New York Friday at 1.3385 after the rate corrected back from lows of 1.3318 to 1.3391. Euro-dollar marked Asian highs at 1.3388 in early Asian trade before turning lower. The weekend press was not very supportive of Friday’s EU Summit plans, with Moody’s basically summing it up by stating that it saw little new in what was agreed and still saw risks for negative action on eurozone sovereigns. The rate drifted lower through the overnight session, eventually marking lows at 1.3334. The rate edged off lows ahead of the European open, getting a kick back up to 1.3355 into the open. Bids have been reported in place into 1.3300, with talk of stops in place between 1.3295-1.3285. However, if triggered this is expected to meet support at 1.3280, with larger stops noted below. Resistance at 1.3385-1.3300.

Gold
Range: 1,684.68 – 1,714.70
Support: 1,672.00
Resistance: 1,724.15

Gold was relatively steady on Friday, opening at 1,708.35 and trading in the 1,703.65-1,724.15 range before closing out the week fractionally higher at 1,711.30. Asian markets have seen a sharp drop in the market, led by copper and silver, with market conditions said to be illiquid and the moves driven by some year-end positional adjustments together with some reported stops loss hunting. Spot gold fell over to 1,684.60, with fears of possible downgrades for EU states from Moody’s and the S&P also weighing on the euro-dollar. This, in turn, is pressuring the precious metals. Today’s support is at 1,672 and 1,666.70, with resistance at 1,724.15 and 1,756.30.

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (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.