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EUR/USD Daily Review 29 Apr 10

Good day koalas.

It is Thursday and remember to finish the week in Green !

Yesterday, we noted that Greece’s rating was cut three steps to BB+ which is BELOW investment grade. Furthermore, S&P believes that the outlook is negative for Greece. Risk aversion was strong and investors dumped their Greek bonds. Portugal received a cut in ratings too.

The EUR/USD recovered above 1.3200.

The S&P 500 recovered too and is currently above 1200 again.

Oil is up at $87+.

Gold remains at around $1168+. This suggests an elevated atmosphere risk aversion as gold is usually in demand during times of economic uncertainty.

***

It was reported today that Greek officials will finish talks with the European Union and the International Monetary Fund in the next few days as signs of agreement stopped a major dump off in the bond market that spread through the euro region this week. While this elevated concerns slightly, i will like to remind that the current solution will probably be for the near term. A continued success depends on a fix of the fundamentals. A positive budget is needed. To do that, strict measures must be taken and this may not be received well with the Greek citizens as they are not willing to bear the consequences of poor financial polices.

Over in the US, a lower unemployment claims figure versus the previous release strengthen the opinion that the American economy is on it’s way to a strong recovery. Having said so, home foreclosures are still happening and banks are still being closed.

From a technical point of view, the strong line of 1.3285 retains it’s influence in the market. Do remember that support and resistance lines are never a single pip.

Tomorrow brings us data such as the Eurozone unemployment and the US Estimated GDP.

Bullish momentum may test 1.3285/3360.

Bearish assaults may see the currency pair hitting 1.3200/1.3090.

***

As much as i always love to chat with you the reader, my crazy day work clocked me 15 hours! I am tired and Ms Sleep is throwing a temper. . . Good night!

Trade safely and remember to be green for the week. . .

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