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EURO & GOLD to Gain – More losses for GBP & YEN – March 12

March 12, 2013
Trading activity in the foreign exchange market was witnessed in a very tight range in the absence of major economic data, as market is still trying to assess Friday’s payroll data to determine the future direction of the market. US economic data should provide more lead in the coming days and weeks.
But things are quite mixed up as there is lot of confusion in Europe. Is reported that last week German governments junior collation partner has shown reservation against weak Euro, as they fear weak currency will lead to inflation, which is nothing new. Rest of the European partners may not support the view because their exports are suffering because stronger Euro that makes them less competitive. Last month French President Hollande voiced his concern on the issue. Economies of Italy, Spain, Greece and others too are faced with similar situation. 
 On top of this Italian split vote is certainly a concerned voice against the austerity plan is surely a setback, which will never be easy to sell by any of the Euro-zone politician. Austerity in present economic condition when economies are struggling to bounce back and unemployment is at all time high. This is an unjust demand by the policy makers, as it can only cause more misery and does not provide relief to a common man, which will remain an unresolved issue due to artificial and false economic mending.
 
GMT 3:07 EURO @ 1.3027 = I can see Euro forming a support base around 1.2970 levels and see risk for a test 1.3070-75 levels, break encourages for more gains or else do not see fall below 1.2940-50 zones. Buy Euro on dips.
GMT 3:12 – GBP @ 1.4897 = Downside risk is intact. Cap around 1.4950-70 for 1.4855.   
GMT 3:16 – JPY @ 96.58 = Yen has weak stance, as I do not see support beyond 96.10 today, may hold 96.40 for test of 96.90-00 zones.
GMT 3:32 – GOLD @ $ 1583.60 = Gold has strong support around $ 1576-78 zones, as looking for a test of $ 1586-88 zones, if seen in Asian session pick top to sell with STOPS $ 1591. Should hold $ 1574.
GMT 3:35 – AUD @ 1.0286 = Buy on dips around 1.0250-60 is preferred as 1.0230 should hold for 1.0315-25.
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