FXstreet.com (Barcelona) - EUR/USD has been recently lifted on
risk appetite, rising after latest injection of liquidity from
PboC, reaching as high as 1.2890 for the session, around
Monday/Tuesday's lows, bouncing from session lows at 1.2866. Local
share markets have all turned also to the positive after the PboC
announcement, taking Aussie higher in particular, thus making
EUR/AUD cross printing fresh session lows around 1.2380. Gold has
also recovered part of the loses from yesterday, last at previous
weekly lows around $1754, while Brent oil is flat for the day.
Busy session ahead in London with all eyes focused on Spain, though
there will also be plenty of risk events coming on the way. German
import prices will be released at 06:00 GMT, followed 1 hour later
by Spanish retail sales, German unemployment change at 07:55 GMT,
EU M3 and private loans 5 minutes later along with Italy business
sentiment, and EU business climate index and sentiment data at
09:00 GMT. UK current account at 08:30 GMT could bring some
volatility to EUR/GBP cross.
In the political front EU vice president Almunia will give a speech
at the International Competition conference at 07:00 GMT, while
Italian PM Monti will speak about Euro at the Council of Foreign
Relations at 13:00 GMT, and IMF will release its World Economic
Report Analytic Chapters, not to mention probably biggest risk
event for all European morning waiting for Spain to enact its
austerity budget for 2013 today, expected to amount for as much as
On the sovereign debt auctions side market's attention will also
focus on Italy as it will deliver long term maturities worth up to
€ 7B, while 10 year Italian bond yields have already crossed above
5% clearly, last at 5.29%, and Spanish 10y ones are also on the
rise last at 6.08%, while German 10 year yields fell below 1.5%
thus making the risk premiums widen again, last with Spain above
the 450bps mark.
Immediate resistance to the upside for EUR/USD comes at recent
session highs/Monday-Tuesday lows 1.2890, followed by yesterday's
highs/Sept 20 lows at 1.2915/7, and Tuesday/weekly highs at 1.2970.
For the downside, nearest term support shows at yesterday's and
fresh 10-day lows 1.2835, followed by Sept 07 highs/200 day SMA at
1.2825, and June 18 highs/Sept 10/11 lows at 1.2750.