Week Ahead: Technicals To Set The Tone
Littlefish FX | Oct 07, 2012 05:27PM ET
Quiet data week this week but with visits in Europe we could hear more about Spain and Greece (Merkel's off to Greece on Tuesday). Expect a strong technicals week with rumours, market talk and comments from influential people providing the catalyst.
Two things to watch out for are rumours on a Spanish bailout and Troika opinions on Greece; once Greece have their money and Spain have a bailout the Euro and risk in general is likely to surge, until that point chances are risk is likely to remain choppy or pushed lower. Draghi also speaks on Tuesday, not doubt we will hear similar to before as he subtly encourages nations to ask for bailouts.
In other news:
- Cameron looks like he is dying to say "no" again to a European budget,
- Might see further sell off in the pound as people look to the potential for further easing in the future
- US elections and the fiscal cliff will become more pronounced in the news
- Given all the recent QE, the growing concern is how the majority of this actually gets unwound from the system and what the impacts of this may be
We currently sit at a bit of an inflection point in many pairs; we are really looking for good entry signals in either direction on many pairs but it is key we wait patiently for the right set ups.
EUR/USD
The Euro pushed higher on Friday but remained relatively flat. Wouldn't be surprised to see a retracement lower again from here. Look for price rejections of the 1.29 mark, which could offer further opportunities to enter long.
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