Good day to all!
Although today brought us more data from the Euro Zone, trading remains slow.
These data were mainly better than expected. French and Italian industrial productions performed much better than expected.
Regardless, the market probably remains apprehensive due to concerns over Greece. The EUR/USD continues to suggest that as the price action slows to a crawl.
The S&P 500 continues to emerge as a winner as it is on the verge of recovering its recent loses. The market seems bullish with regards to the American economy.
Oil is back above $80. A performing economy brings demand for oil.
Gold is valued at $1122+. Lately, the volatility of gold is rather low.
Greek deficit crisis is over and Euro Zone is safe. So says the former European Commission President.
While the Greek government did take measures in cutting spending and increasing tax, we must not forget that the general Greek populace is unhappy. If strikes and objections are to escalate, all carefully planned measures may be hampered. Furthermore, sentiments do not change over night and probably not over comments. The complication of a rating cut by rating agencies remains. Therefore we must remain vigilant.
Over in the US, despite these bullish sentiments, people are still losing their jobs. Unemployment remains a problem. A better than expected Non Farm Payroll perhaps but it is still people losing jobs. Furthermore, the unemployment problem is apparently having an increasing anchor effect on home sales. We know home sales create good economic activities and hence a lack of it may make the recovery a run up a steep hill. Not forgetting that foreclosures are still happening.
Do note however that ECB’s Trichet is due to talk later. Any possible hints on any upcoming policies may trigger movement in the currency pair. The US Federal Budget Balance is due later too and any negative developments may upset the bullish favor towards the US Dollar as investors seek to understand the extend of the US deficit. Tomorrow brings us a few important releases including the US Unemployment Claims.
Bullish pressure may test 1.3680/720.
A bearish return may test 1.3600/550.
A few readers wrote to me and said that the slow price action is unbearable. While it may be slow, i urge you to take it as a time to read up on articles and to analysis charts. If you cannot profit in the meanwhile due to the slow action, why not profit intellectually and learn a thing or two more about forex trading?