EUR/USD retreats from 1.3655

The rally of the EUR/USD was capped by the 1.3650 area, after climbing 180 pips from 1.3480. The pair is now retreating from the highs, attempting to hold above 1.3600, still posting a daily gain of more than 70 pips.

From a technical perspective, the Talking-Forex Analysis Team see supports at 1.3530, 1.3479 and then at the 21-day lower Bollinger level at 1.3263. “On the other hand, resistance levels are seen at the 10DMA line at 1.3649 and then at 1.3799.”

An improvement in market sentiment and hopes for more action regarding the European debt crisis triggered risk appetite on markets that weakened the Dollar versus the Euro.

From Monday’s low at 1.3360 the Euro rose more than 250 pips. Despite recent price action, the pair is still on its way to the worst monthly performance since November 2010.

EUR/CHF targeting 1.2346 ahead of 1.2469 − UBS

 

The EUR/CHF bias has shifted to bullish after breaking above 1.2191 yesterday, says Chris Walker, analyst at UBS Bank, who sees the pair targeting 1.2346, and above here, 1.2469, which immediate support at 1.2051.

EUR/USD capped at 1.3700, dips to fresh lows

 

Euro reversal from 1.3935 high last week has extended to 13645 in Asia, with the pair weighed by renewed concerns about Greece, where the pair found support to bounce up at European opening, although, capped at 1.3700, the pair has turned lower again, dipping to fresh lows at 1.3630.

On the downside, the pair might find support at 1.3590 (Sept 14 low) and 1.3555 (Sept 13 low) before facing 1.34954 (Sept 12 low). On the upside, immediate resistance lies at 1.3700/05 (day highs), and above here, 1.3730/50 (broken trendline support) and 1.3795 (Gap from Sept 16 closing price).

On the long-term, the downtrend from 1.3940 remains active, heading to 1.3555 and 1.3240 says Stoyan Mihaylov, analyst at Deltastock: "The downtrend from 1.3940 is still intact, targeting 1.3555, en route to1.3240. Initial resistance is projected at 1.3750 and crucial on the upside is 1.3800."

USD/JPY downtrend expected to resume − Mizuho

Triangle consolidation in May and June resulted in another decline, and the pair has formed another triangle in August according to Nicole Elliot, technical analyst at Mizuho Corporate Bank, with all aspects of the weekly Ichimocu cloud suggesting another step lower.

Technical indicators suggest a resumption of the longer-term downtrend, says Elliott: "Having set a new record low at 75.94 on the 19th, and pushing into the apex of this very irregular little pattern, we shall be expecting the downtrend to resume as all aspects of this weekly Ichimoku ‘cloud’ chart suggest it should."

Downside targets below 75.95, according to Elliott, would be at 74.50 and 73.50: "Measured targets lie at 74.50 and 73.50. Obviously prices can also spiral out of control, but at the moment this looks unlikely."

EUR/USD another week between 1.40/1.45

 

Heading into the final hours of the trading this week, EUR/USD holds barely below 1.4500, recording a 0.79% gain on the day and the week. 

The pair continued to seesaw back and forth inside its recent 1.4000/1.4500 range, although this week it held above 1.4300 and quoted nearer the topside, peeping briefly above 1.4500 on Friday boosted by a solid rally in US equities after Fed's Chairman stopped short of signaling further monetary stimulus in Jackson Hole.

Bernanke finally did not announce a third round of QE during his speech in Jackson Hole, but he didn't ruled it out either, shifting focus to September 2-day FOMC meeting.

Regarding the week ahead, Valeria Bednarik, chief analyst at FXstreet, commented, "The return of full market volume during early September may trigger some wild movements in the cross, although I would expect the 1.40/1.45 range to hold. Neither Euro nor Dollar, will gather enough strength to define a trend anytime soon".

EUR/USD plummets, hits fresh weekly lows

After moving sideways for many hours, the EUR/USD broke to the downside and tumbled below 1.4400, as market sentiment deteriorates in Europe and in Wall Street. The pair reached a fresh weekly low at 1.4340 after falling more than a hundred pips in an hour.

“Triangle support currently lies at 1.4400, while the upper boundary is at 1.4466, with break of either side to signal near-term direction,” wrote earlier Slobodan Drvenica, analyst at Windsor Brokers Ltd. According to him, if the pair breaks below 1.4250/60, the short-term structure would weaken.

The Euro is weakening across the board, extending losses versus commodity currencies and trimming gains versus its European rivals.

USD/JPY slumps to fresh historic lows

 

USD/JPY slumped to a fresh all time low in recent trade on widespread Dollar weakness. USD/JPY accelerated to the downside and broke below its previous low at 76.25 to set a fresh never seen low at 75.94.

However, USD/JPY quickly bounced back above 76.00 and at time of writing it is trading at the 76.15 area, recording a 0.54% loss on the day.

Now all eyes are on Japan to see whether its officials will act after the Dollar hit a fresh record low against the Yen. Japanese officials have been threatening with stepping in the FX market to curb Yen's strength.

USD/JPY a break of 76.00 may trigger a new wave of short covering − BBH

 

It is difficult to have much confidence in support/demand for dollars against the yen below 76.25 its historic lows, said Marc Chandler, Global Head of Currency Strategy at Brown Brothers and Harriman. "However, a break of JPY76 may trigger a new wave of short covering by Mrs Watanabe and hedging by Japanese corporation".

"Based on current spot and volatility, JPY72.75 is 1 standard deviation from spot and about JPY69.25 is 2 standard deviations. These are cited to be suggestive of where the dollar can go from a simply quant point of view", said Mr. Chandler.

GBP/USD above 1.6475/80, approaching 1.6600

 

Pound bearish reversal seen on early London session has been contained at 1.6350, and were the pair found support to bounce up breaking through 1.6475 resistance area, which has acted as support on early US session to push the pair to fresh 3−month highs at 1.6555.

The pair is struggling against resistance at 1.6550 (May 30 high), above here, next resistance levels are 1.6580 (May 4 high) and 1.6750 (Apr 20 high). On the downside, immediate support lies at 1.6475 (Aug 8/16 ighs) and below here, 1.6350 (day low), and 1.6255 (Aug 15 low).

Technical indicators remain pointing higher, according to Valeria Bednarik, technical analyst at FXstreet: "Hourly indicators support the upside, as per heading back higher, while 4 hours chart shows an even stronger bullish momentum at the time. Previous highs around 1.6475 are now key support, for the cross, as buyers will dominate the pair as long as above that level."

EUR/USD consolidates recent gains

The Euro rose sharply against the Greenback on Monday supported by the risk−on mood and expectations of a positive outcome of Tuesday's Merkel/Sarkozy meeting.

EUR/USD rose to an almost 3−week high of 1.4476 but lost momentum and eased to the 1.4440 region along with stocks pullback, and has spent the last hours consolidating gains in a narrow range around that level. At time of writing EUR/USD is quoting at the 1.4435/40 area, printing a 1.19% gain on Monday.

According to Valeria Bednarik, chief analyst at FXstreet, the pair shows a strong bullish momentum in the 4-hour chart and could extend gains over the upcoming sessions, if current candle closes above 1.4460 price zone. "In that case, 1.4500/20 comes as next level to watch, ahead of 1.4580 strong static resistance area as per past July monthly high", said Bednarik.

"Only below 1.4410 the pair may lose momentum and slide towards the 1.4350 area", she added.

EUR/USD is a choice between a rock and a hard place – Commerzbank

 

 A collapse on the stock markets, zero rates in the US until mid−2013 and ECB intervention on the bond markets are events which under normal circumstances would probably have been price sensitive for EUR/USD, but it has instead remained relatively stable , according to Lutz Karpowit, analyst at Commerzbank.

"However, that does not mean that the FX market remains unaffected by this data: Instead the effects on euro and dollar cancel each other out", said Karpowit. "On the one hand the fear of renewed quantitative easing (QE3) is weakening the USD. On the other hand the euro is under pressure due to the risk of a further escalation of the European debt crisis. On the data front, bad US prints should paradoxically continue to support the US dollar via an increase in risk aversion".

On this backdrop, the Commerzbank analyst team expects a trading range of 1.3800-1.4500 for EUR/USD next week.

EUR/USD rallies towards high 1.4275

 

The rally on Wall Street in early trade has triggered the EUR/USD back towards the day's high of 1.4275, despite sinking prior to opening bell towards 1.4100. The pair has seen wild swings today given the overall volatile sentiment as traders remain cautious but attempt to take advantage of buying opportunities presented by this week´s sharp sell-off.

Valeria Bednarik of the FXstreet Independent Analysis team remarked earlier: “Pair regained latest 100 pips as risk aversion eased after US employment data, and stocks are way off daily lows. Still the pair needs at least to consolidate above 1.4200, to suggest further gains today as 4 hours chart still holds a negative tone.”.

Bednarik goes on to list resistance at 1.4250, 1.4285 and later 1.4320 while support underneath is placed at 1.4200, 1.4170 and later 1.4130.

GBP/USD dips on downbeat UK data

 

Pound recovery from 1.6265 lows on early Asian session has been capped right below 1.6400, and the pair has pulled lower, reaching 1.6315 low, following weaker than expected manufacturing and trade balance figures in the UK.

UK trade deficit rose to GBP 8.9 Billion in June from GBP 8.5 billion inn May, against market consensus which called tor a tightening to around GBP 8.4 Billion.

UK manufacturing output has dropped 0.4% in June, against market expectations of a 0.3% increase, and following a 1.8% advance in May. Year on year, manufacturing output rose 2.1% below the consensus 2.8%.

GBP/USD breaks 1.6300, support at 1.6270

 

GBP/USD managed to hold above 1.6300 on Monday, dipping into the 1.6295 zone before a slight bounce to close the session at 1.6318, around 150 pips below its starting price. In Asia, the bearish tone remains intact and the pair has broken below 1.6300, extending its decline into the 1.6270 area where it has encountered support at the 20−day EMA.

According to Valeria Bednarik, Chief Analyst at FXstreet: “although the pair enters Asian session with a slightly negative tone: hourly chart shows price unable to overcome 1.6335 immediate resistance zone, while indicators remain below their midlines yet aiming higher. Bigger time frames, show 1.6200/1.6475 range mostly intact, with 4 hours momentum flat as well as 20 SMA, lacking clear direction,” she explains.

At the time of writing, GBP/USD is respecting support at 1.6270 but is still under pressure in Asia, last quoted in the 1.6285 area, around 35 pips below its starting price. To the downside, Ms. Bednarik finds support at 1.6250 and 1.6210, while, to the upside, resistance levels lie at 1.6335, 1.6370 and 1.6420.

EUR/USD upside limited at 1.4400

 

Euro recovery from 2−week low at 1.4050 on Friday, extended above 1.4300 on early Asian session, and the pair rose at European opening, buoyed by ECB move to purchase Italian and Spanish debt, to find resistance at 1.4400, and ease to current levels around 1.4350.

On the upside, immediate resistance lies at 1.4400 (session high), and above here, 1.4455 (Aug 1 high) and above here, at 1.4535 (Jul 27 high) and 1.4575 (Jul 3 high). On the downside, the pair remains held by 1.4300 area (day lows), and with next potential support levels at 1.4145 (intra-day level) and 1.4055 (Aug 5 low).

On the longer-term, the pair remains trading in a wide range, according to Stoyan Mihaylov, technical analyst at Deltastock: "Trading takes place in a wide range and the daily levels of resistance are situated in the price zone of 1.4450, as well the support level is created by the 200 day SMA. In the case of a break through the resistance level a new price target of 1.4700 can be expected."

S&P downgrades US credit rating to AA-plus

 

The United States lost its AAA debt rating, on late Friday, from Standard & Poor's for the first time in history. The credit−rating agency said the political system of the world's top economy has become less stable and is still concerned about the government's budget deficit and rising debt burden.

"The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the Administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government's medium-term debt dynamics," S&P said in a statement.

The outlook on the new U.S. credit rating is "negative," S&P added, which means another downgrade is possible in the next 12 to 18 months.

US government says S&P is wrong

The White House reacted with indignation to Standard & Poor's credit rating downgrade from AAA to AA-plus. A government spokeswoman said to media that S&P was wrong in its calculation, the debt value was overestimated by 2 billion, she stated.
Republicans asked President Obama division.

EUR/USD ends the week lower despite Friday's bounce

Despite Friday's bounce, EUR/USD is on track to close the week with losses for second time in a row as investors flied to safety favoring safe-haven assets over higher-yielding currencies over the last days.

On Friday, better-than-expected July NFP report coupled with media reports saying the European Central Bank will buy Italian bonds brought some relief to financial markets a day after Wall Street suffered its worst decline since February 2009.

EUR/USD is currently trading at the 1.4260 area, up 1.2% on the day but still 0.83% below its Monday's opening. The pair had hit a weekly high at 1.4453 on Monday and a low of 1.4054 during Friday's Asian session on the back of ECB's dovish comments

GBP/USD extends above 1.6350 on firm UK PMI

 

Cable pushes higher in morning trade over Europe, extending another 50 pips in the last hour to reach as high as 1.6360 where it appears to run into minor headwinds. The upside momentum comes on the back of an improving UK PMI result for the services sector, bucking the trend for other nations across Europe.

The EUR/GBP is similarly influenced by the fundamental release, dropping quickly from it´s prior high of 0.8760 back towards 0.8720. The pair hsa been trading just to the upside of 0.8700 in recent sessions, without being able to break above 0.8770 resistance.

Regarding the PMI report, the index for the UK services sector improved to 55.4 in July in comparison to the prior 53.9. The result is its best since March of this year.

Forex: USD/JPY recovers ground above 77.00

The Yen is moving off session lows as stocks in the US trimmed losses and also supported by a report from Nikkei saying that the US is open for a currency intervention from Japanese authorities, which according to the report would sell the yen as needed. USD/JPY extended its recovery from 76.28 and rose back above 77.00.

Greenback reached 77.27 and at the moment is trading around 77.14/18, near the same price level it had at the beginning of the week.

The Yen with the Swiss Fran are among the best performs of the day amid risk aversion. Market sentiment changed its bias considerably after a weak economic report in the US.

Stocks in Wall Street are lower. The Dow Jones is falling 0.76% and the Nasdaq is down 1.28%. In Europe main indexes finished with important losses: FTSE 100 -0.70%, DAX -2.85% and the CAC 40 -2.30%.

Forex: GBP/USD mild bounce capped by 1.6290

The Pound lost ground versus the Greenback on Monday as it was hit early European session by a weaker-than-expected UK manufacturing PMI and pressured further by the risk-off mood that emerged after the Wall Street opening. GBP/USD dropped over 220 pips from daily highs, touching the lowest level since Jul 21 at 1.6236.

Even though the pair bounced from lows, the recovery was capped by the 1.6290 zone and the pair has spent the last hours consolidating inside a tight range between the mentioned levels. At time of writing, GBP/USD is quoting at the 1.6260/70 region, recording a 1% loss on the day.

On the downside, next support levels could be found at the 1.6230/35 zone, followed by 1.6200 and 1.6175, while on the upside, immediate resistances might be faced at 1.6290/1.6300 ahead of 1.6340 and 1.6490.

Forex: USD/CHF takes a breather above 0.7800

The Swissy posted a fresh all time high versus the Dollar on Monday, as debt concerns continue to weigh down on the US currency, while a lower−than−expected manufacturing ISM did nothing but to intensify the sell−off in the cross.

USD/CHF dropped almost 200 pips along the day, hitting a never seen before low at 0.7727 before bouncing back above 0.7800, where it has been consolidating in a tight range within the last couple of hours. At time of writing, USD/CHF is trading at 0.7812, still 1.35% below its opening price.

"Oversold hourly conditions suggest corrective bounce, however 0.7951 offers strong resistance and only break here to ease immediate bear pressure", said Slobodan Drvenica, analyst at Windsor Brokers Ltd.

Forex: EUR/USD ends week unchanged

 

The Euro finished on Friday around the same price level it opened Monday's Asian session against the Dollar and ended July with a small monthly loss far from the lows.

EUR/USD jumped on Friday after the release of week economic data in the US and recover from weekly lows at 1.4230, reaching levels above 1.4410. The pair erased weekly losses but it was unable to hold above 1.4400.

Next week will be important for markets observers: the debt ceiling in the US will be reach, the ECB and the BoE will decide on monetary policy and next Friday, the big employment report will be published in the US including the unemployment rate and non-farm payrolls.

These events are likely to increase volatility in the market and particularly in the EUR/USD. The Euro could come under pressure once again if the market turns its attention from the debt ceiling crisis toward the EU debt crisis, pointed out Ilian Yotov, FX Strategist and Founder at AllThingsForex.

“The probability that the euro will reach over 1.4696 next week is extremely high, the probability that it will move above 1.4748 though is very low,” said Lara Iriarte, Director and Technical Analyst at ElliottWaveForex on its forecast. According to her the EUR/USD should find a high between those levels before turning to the downside for a new strong trend. 

Forex: USD/CHF hits fresh highs above 0.8030

The USD/CHF is recovering ground from all time lows and recently reached a fresh daily high at 0.8035, approaching to Wednesday’s high that are located at 0.8045. The pair bottomed on European hours at 0.7988, record low.

Slobodan Drvenica, analyst at Windsor Brokers Ltd affirms that the pair remains in a near-term narrow range sideways trade. “Current consolidation is seen preceding fresh leg lower, as near-term studies remain negative, with 0.7950/00 in focus.” To the upside, the analyst says that only a regain of 0.8075 would ease immediate bear pressure.

The Swiss Franc is also moving off session highs against its European rival as market sentiment improves in Europe and in the US.

Forex: EUR/USD fails to hold above 1.4300

The hegemonic currency was lifted above 1.4300 against the Greenback, supported by stocks entering to positive ground in Wall Street in the wake of better-than-expected pending home sales data.

EUR/USD rose near 60 pips from its 1-week low at 1.4254, breaking above 1.4300 to a high of 1.4313. However, the Euro couldn't sustain momentum and has retreated to the 1.4290/95 zone where it is currently trading, 0.50% below its opening price.

"On the upside, 1.4325 zone offers initial resistance, while only regain of 1.4400 would improve near-term tone", said Slobodan Drvenica, analyst at Windsor Brokers Ltd. Drvenica sees immediate resistance levels at 1.4325, 1.4376 and 1.4400, while he places next support levels at 1.4250, the 1.4200/1.4190 area and then 1.4156.

Forex: USD/CAD jumps, approaching 0.9500

The Dollar jumped across the board in the last hour as stocks decline in Wall Street and Europe and gold retreats sharply. USD/CAD rose 70 pips in 30 minutes and moved away from multi-year lows. Greenback jumped from 0.9420 to 0.9490, reaching the strongest levels in two days.

To the upside, immediate resistance lies at 0.9495/00 and above at 0.9520/25 (July 22, 25 highs) while support could be located at 0.9440 and below at 0.9400/05 (July 26 low).

The Loonie weakened in the market as crude oil tumbled to $97.30 a barrel, following a reported that showed an increase in inventories. CAD/CHF plummeted from 0.8505 to 0.8434, 4-week low while NZD/CAD jumped to 0.8257, hitting a fresh 4-year high.

Forex: EUR/GBP at daily low 0.8810

With conflicting messages coming out of the Eurozone, investors are turning attention back to the communities debt problems and subsequently pressuring the EUR lower today. The EUR/GBP thus has edged slightly below the day´s opening price, trading currently at a daily low of 0.8810 in morning trade over New York.

While appearing to run into modest support at its current level, the next critical levels to be aware of are listed at 0.8798 (Daily Low Jul 22), 08757 (Daily Low Jul 19) and 0.8706 (Daily Low Jul 18). To the upside, resistance is placed at 0.8877 (30-Day MA), 0.8883 (Daily High Jul 26) and 0.8895 (50% of 0.9084 – 0.8706).

Nick Bennenbroek of Wells Fargo reports: “The euro reversed some of yesterday’s gains as German finance minister Schaeuble said he was again a ‘blank check’ for secondary bond market purchases by Europe’s financial aid fund. There were also reports that the IMF is looking to limit its contribution to the further Greek financial assistance package.”

Forex: EUR/USD tumbles below 1.4450

 

EUR/USD retreated further from 3−week highs at 1.4535 and extended its decline below 1.4500. The Euro broke under 1.4440 and tumbled to 1.4421, reaching a fresh daily low.

At the moment EUR/USD trades at 1.4430, more than a hundred pips and is trimming weekly gains. According to Slobodan Drvenica, analyst at Windsor Brokers Ltd the 1.4437 is a strong support and at 1.4430 the daily 20 SMA lies. “Holding above 1.4320 zone, 22/25 July higher platform and main trendline support keeps the bullish outlook intact.”



The Euro also fell to new daily lows against its European rivals and also versus the Yen as stocks extend losses in Wall Street in Europe. 

Forex: AUD/USD retreats from record highs

The Australian dollar has given up some of its recent gains against the Greenback, retreating to the 1.1030 zone, tracking gold moves, which is also pulling back from a fresh all-time high set at $1,631.20 an ounce in recent trade.

AUD/USD however, seems to have found support at the 1.1030 zone and it is currently trading around 1.1040 where it is 0.68% above its opening price and near its new post-float record high struck earlier at 1.1078. Australian Dollar gains were propelled by higher-than-expected CPI figures published during the Asian session, which signal the RBA may need to further tighten monetary policy in the near-term, coupled with a broad-based weak Greenback.

Nick Nasad, analyst at FXTimes sees the first target to the topside between 1.1225-1.1245, and then halfway between there and the 1.1295 level, around 1.1265 for further upside gains in the pair. "Such a rally may first be prefaced with a throwback, but I expect any throwback to be a shallow one", said Nasad.

Forex: Commodity currencies hold gains against USD

The so-called commodity currencies such as the AUD, CAD and NZD, are trading near multi-month highs against a weakened Greenback as the US Congress hasn't progressed on talks over raising the debt ceiling, needed before Aug 2 in order to avoid default.

The Loonie reached on Tuesday its strongest level in almost 4 years against the Greenback. USD/CAD bottomed out 0.9405 during the European session, hitting its lowest since Nov 2007, and bounced, although the recovery has been limited by the 0.9450/55 resistance area. USD/CAD has been moving in a 30-pip range for the last hours and currently quotes at 0.9440, where it remains 0.33% below its opening price.

AUD/USD rose over 120 pips on Tuesday and touched a 12-week high at 1.0963 before settling right below that level. The Aussie is trading at the 1.0950 area, on track to set the 6th consecutive daily gain.

The Kiwi established a fresh record high against the big Dollar at 0.8740 before the Wall Street opening and consolidates near that level, around 0.8715. The NZD has gained 5% so far this month.

Forex: USD/CHF finds resistance at 0.8040, remains near all time lows

 

The Swiss Franc rose to fresh record highs against the Dollar after Barack Obama remarks on negotiations between republicans and democrats amid the debt ceiling crisis. USD/CHF bottomed at 0.7999 and recovered ground at a slow pace. The recovery of the Dollar found resistance at the 0.8040 level during the European morning and since then it has been moving sideways in a small range, around 0.8020/25.

“Previous low at 0.8073 offers initial resistance, ahead of 0.8135/50, 21 July low / 25 July high, where a lower top is anticipated, to maintain bear structure,” said Slobodan Drvenica, analyst at Windsor Brokers Ltd. According to him only a regain of 0.8276, “would ease immediate bear pressure.”

Greenback is headed toward the sixth monthly decline in a row and has fallen more than 150 pips from Friday’s closing price.

Forex: GBP/USD bounces after limited correction

After staging a short-lived correction toward the 1.6370 area as the US Dollar spiked on the back of a better-than-expected US consumer confidence reading, GBP/USD has resumed its upward move, inching back to the 1.6400 area.

GBP/USD is currently trading at the 1.6400/05 region, recording a 0.81% gain on the day. Cable had climbed over 150 pips and peaked at 1.6419 earlier on Tuesday, setting a fresh 6-week high, underpinned by UK growth report.

Valeria Bednarik, chief analyst at FXstreet, sees immediate resistance levels at the 1.6420 area, ahead of 1.6450 and 1.6490, while she locates support levels at 1.6340, 1.6300 and 1.6270. "Lose of 1.6340 however, may put the short term trend towards the downside, more if market sentiment continues changing to risk aversion today", said Bednarik.

Forex: EUR/USD rises back above 1.4500

The retreated of the Euro from 3-week highs at 1.4521 found support at 1.4455 and recently it gained momentum and resumed the upside. EUR/USD is currently testing levels on top of 1.4500, at levels not seen since the European morning. At the moment the pair trades at 1.4505, 130 pips above today’s opening price. Since July 4 the EUR/USD does not close a day above the 1.4500 level.

According to Valeria Bednarik, Chief Analyst at FXstreet, hourly charts in the EUR/USD show price well above bullish 20 SMA currently around 1.4440 (previous daily highs and strong support) “while indicators are flat giving no clear signs of further strength either side of the board. 4 hours indicators, hold a timid bullish momentum helping keep the downside limited for now.”

Forex: EUR/USD steady in range

EUR/USD bounced off daily lows that lie at the 1.4325 area, and has risen near 50 pips during the New York session as the Greenback remains pressured amid uncertainty over the US debt ceiling deal. The Euro climbed half a cent toward the 1.4375 zone, where it is currently trading, still 10 pips below its opening price.

EUR/USD trade has been marked by erratic swings in range between 1.4325 and 1.4335 during Monday's American session, with the pair unable to set a fresh direction in typical summer trading.

From a technical view, Fan Yang, analyst at FXTimes, considers a break above 1.4450 as an initial signal for a medium-term bullish continuation, with short-term target at 1.4555 and a target towards 1.4940 in August. On the contrary, Yang points out that break below 1.4230 starts the bearish continuation outlook. "A short-term outlook targets 1.41. A break below that opens up 1.3850", he said.

Forex: GBP/USD remains rangebound below 5-month highs

GBP/USD retreated from a 5-month high reached during the Asian session at 1.6340, and has spent most of the day rangebound between 1.6260 and 1.6330 as investors remain cautious ahead of the UK second quarter GDP figures to be published on Tuesday. At time of writing, GBP/USD is trading at the 1.6285 zone, recording a 0.28% loss on the day.

"Current narrow-range consolidation is seen preceding fresh push higher, to target levels above 1.6400 barrier", said Slobodan Drvenica, analyst at Windsor Brokers Ltd. "Corrective dips need to be contained by 20 day MA, currently at 1.6250 and trendline support/previous high at 1.6230/00 zone, to maintain immediate bulls, otherwise, deeper reversal into 1.6130/1.6060, Fib 38.2%/50% levels, would be the likely scenario".

Regarding UK's GDP, economists anticipate a 0.2% growth over the second quarter, although a lower-than-expected result could raise expectations of more monetary stimulus from the BoE, weakening the Sterling.

Forex: USD/JPY trims losses and rises to 78.40

Greenback extended its recovery from daily lows against the Yen following Wall Street opening and rose above 78.30 reaching at 78.42, the highest price since the European morning. Currently trades at 78.34/36, less than 20 pips below Friday’s closing price.

On a wider perspective, according to Alpari, the USD/JPY is likely to weaken over the short-medium term “because of lingering market concerns about a US sovereign downgrade and low probability of JPY selling intervention, especially given that Japanese equity markets continue to hold up well despite a strong JPY.”

The Yen also fell in the last hours against European currencies as stocks in the US trim losses. In Wall Street, the Dow Jones is losing 60 points but initially it was falling 120 points.

Forex: USD/CHF holds near records lows, attempts to recover above 0.8050

The USD/CHF reached an all time low earlier during the European session at 0.8020. The downside took a breather in the last hours and the pair moved slightly of session lows and at the moment it is attempting to recover further ground above 0.8050 and trades at 0.8052/55.

Despite bouncing from the lows, Greenback is trading 130 pips below Friday closing price.

According to Slobodan Drvenica, analyst at Windsor Brokers Ltd the pair weakened after breaking below 0.8073, which lead to new record lows. “This keeps broader bear tone firmly in play, as daily studies point lower. On the downside, 0.8000 is an initial target, break of which to open figures at 0.7950/00, while 0.8130/50 zone caps.”

Forex: EUR/USD falls to test daily lows

The Euro weakened in the market after the opening bell at Wall Street. EUR/USD broke below 1.4355/60 and fell to 1.4335, level that is located just 10 pips above daily lows. If it falls below 1.4320 it would be trading at the lowest level since last Thursday, when the European Council announced measures to address the European debt crisis.

From a technical perspective, Valeria Bednarik, Chief Analyst at FXstreet, affirms: “Lacking definition, hourly chart shows indicators flat around their midlines, while price hovers around and also flat 20 SMA. 4 hours chart shows a slightly bullish tone as per a strong 20 SMA heading north, yet only above 14440, past week high, the pair may resume its bullish tone.”

The Euro also weakened versus the Swiss Franc and reached a fresh 6-day low. EUR/CHF fell to 1.1518, rebounded and currently trades above 1.1530. 

Forex: EUR/JPY threatens 112.00

The EUR/JPY is currently eroding daily support just to the upside of 112.00, as an all-around risk averse sentiment hangs over the marketplace given the ineptitue of the US political system to raise the debt ceiling. The pair had earlier reached as high as 113.00 over the Asian session, however cautioun has favored the typically considered safe-haven yen since then.

While the EUR/JPY so far has not broken support at 112.00, if that goes expected further critical levels at 111.68 (Tenkan-Sen Line) and 111.44 (Daily Low Jul 21). To the upside, resistance is placed at 113.02 (Session High Jul 25), 113.57 (Daily High Jul 22) and 113.66 (Kijun-Sen Line).

Forex: EUR/USD bottoms at 1.4325

 

The EUR/USD retreated further from weekly highs after Wall Street opening and bottomed at 1.4324, daily low. The pair found support at the mention level and rebounded to the upside, trimming losses. The recovery faced resistance at 1.4380 and currently EUR/USD trades at 1.4360/65, 0.40% below today’s opening price.

The Euro trimmed losses in the last hour but is still headed toward the first daily decline of the week. On a weekly basis it is rising almost 250 pips.

“While the euro may dip and even as far as 1.3770 (support on the weekly chart), we can easily see a return to the Nov 30, 2009 high at 1.5141 before the end of August,” wrote Barbara Rockefeller in the daily report.

Forex: USD/CHF retreats to 0.8150

The Dollar erased gains versus the Swiss Franc. The USD/CHF peaked during the European session at 0.8244, the highest price in two days but it failed to hold, lost strength and started a retreated. The decline found support around the 0.8150 zone. In the last hours the pair has remained relatively steady moving in a range between 0.8150 and 0.8185, around the same price level it had at the beginning of the day.

“Steady below 0.8200, the pair seems to be gaining further bearish strength in current American session, with price below 20 SMA and indicators just below their midlines, although lacking strength at this time,” said Valeria Bednarik, collaborator at FXstreet. According to her, below 0.8145, the pair could fall further to test all time lows at 0.8070.

Forex: AUD/USD backs away from 10-week highs

The Aussie has moved off its 10-week high reached earlier at 1.0873 against the Greenback as risk appetite is easing on Friday after the spike the markets enjoyed yesterday. AUD/USD fell around 35 pips from highs to the 1.0835 area where the correction was contained by the 20-hour SMA.

Despite the bearish correction, the Aussie is holding pretty well, supported by gold prices' sharp rise. At time of writing, AUD/USD is trading at the 1.0845/50 area, still 0.10% above its opening price.

"The overall bullish outlook remains intact for a rise to 1.10+ levels. Resistance-turned-Support is seen at 1.0800 and then significant Support is seen near 1.0730", comments the Kshitij Consultancy Services team. "A dip to 1.0750-30 if seen can attract fresh buying in the market. As mentioned in the morning, Aussie is gearing up for a rally to 1.10 or even higher in the coming days/weeks".

Forex: EUR/USD rally continues above 1.4400

The EUR/USD broke decisively above 1.4400 and jumped to 1.4435 hitting a new 2-week high. The Euro resumed its rally after the release of a statement made by the Council of the European Union with details about the agreement on a plan to help Greece. The pair has now risen 300 pips from Thursday’s low.

“Technical studies indicate that supports are located at the 100DMA line at 1.4303 and then at the 10DMA line at 1.4152. On the other hand, resistance levels are seen at 1.4467/96 and then at the 21Day Upper Bollinger Level at 1.4557,” the Talking-Forex Analysis Team wrote on its daily report.

The Euro is opening the Asian session on a strong note, gaining ground across the board.

Forex: EUR/JPY takes the lead early Asia

A rocketing Euro is finding fresh buyers early in the illiquid transition from New York to Asian markets. The opposite is true for the Japanese Yen, surprisingly unable to unleash any bullish speculative attack at this time of the day; it did actually on USD/JPY, but failed miserably.

The combination of both behaviors leaves us with EUR/JPY landing at a new high of 113.25, after taking off at 112.88.

The fact that European officials finally came around to a long-term solution over the Greek debt crisis is encouraging the bid tone, which will find the first area of congestive traffic around 113.50. The bullish engulfing bar on the daily chart keeps the bias higher, and until reaching mentioned resistance (current price 113.20) a run-up of 30 pips in the next few hours is likely.

So, looks like there is still a chance to make some pips for those jumping in the Euro bandwagon, as long as no risk averse news hit the wires. Any turnaround on the current rise, and we envisage 112.65 area to provide decent support for the Euro.

Forex: Bearish USD/CHF spikes at Asian open

 

Since USD/CHF price action has a tendency to move on the contrary (negatively correlated) to EUR/USD, traders are now more confident that serious inroads to the downside can be achieved as the Euro strengthens throughout the market after Europe agreed on Thursday to a financial aid package giving urgent aid to save Greece from default.

As a result, the Swissy has gained ground against the Greenback for the second consecutive day, opening Thursday’s session at 0.8192, advancing into the 0.8235 price zone in early Asia, then retreating to target fresh 3-day lows below 0.8150 (July 19 low) where it has just closed the American trade.

At the time of writing, USD/CHF has spiked into the 0.8205 zone at Asian open only to return to prices back near the open. Now that a handful of weaker shorts have been taken out, another test of USD/CHF bids into 0.8080/75 can be expected. To the upside, above 0.8205, next resistance lies at 0.8235. To the downside, next support lies at 0.8120 (July 15 low).

Forex: USD/JPY bottoms out at 78.30

 

The USD/JPY is falling on Thursday for the second day in a row despite risk appetite. US Dollar bottomed at 78.30, the lowest level in 4−months, and currently is moving slowly off session lows, attempting to recover ground above 78.50. The pair is on its way to the lowest daily close on record.

The upside remains capped by a strong resistance level around 79.30 (July 15, 19, 20 highs). To the downside the pair continues to reach lower lows signaling a continuation of a long-term downtrend. Today Greenback approached record lows that lie at 76.40 (March 16).

Forex: USD/CHF drops to 2-day low

The US Dollar remains weak across the board and is setting fresh session lows against the Swissy during the American afternoon. USD/CHF has dropped near 60 pips since the Wall Street opening, breaking below the 0.8200 mark and printing a fresh 2-day low at 0.8157 within the last hour. Currently, the cross is quoting at the 0.8165 region, 0.33% lower since opening.

According to Valeria Bednarik, analyst at FXstreet, USD/CHF needs to lose 0.8145 static support zone to gain bearish momentum and extend its slide near record lows around 0.8070. Bednarik places next support levels at 0.8145, 0.8100 and 0.8070, while she locates immediate resistance levels at 0.8200, 0.8235 and then 0.8280.

The Greenback is among the worst performers on Thursday, as optimism over an agreement in Europe to deal with the region's debt crisis damped Dollar's appeal.

Forex: USD/CAD consolidates above 3 ½-year low

The Loonie advanced further against the Greenback on Thursday, reaching its strongest since November 2007 as the Dollar weakened on risk appetite during the American session on prospects a Greek bailout deal could be reached.

USD/CAD fell to its lowest in over 3 ½ years at 0.9422 , also supported by stronger oil prices, and has been trading in a tight range just above that level ever since. At time of writing, USD/CAD is quoting at the 0.9445 zone, 0.29% below its opening price.

The Canadian Dollar is gaining for third straight day versus the US currency as the CAD strengthened this week after the Bank of Canada signaled it was closer to raising interest rates.

Forex: AUD/JPY, signs of bearish bias - FXTimes

AUD/JPY can be observed as a barometer of risk sentiment, according to Fan Yang, CMT, Chief Technical Strategist at FXTimes.

“Resolution of European debt crisis, as well as unified approach dealing with the US debt ceiling and overall budget issues are things that can boost risk appetite. In that regards, tomorrow’s EU summit can shake things up for the Aussie-Yen as well,” he explains.

From a technical standpoint, “The RSI reading in the 4H chart however was able to break the previous high, but found resistance at 60. Staying below 60, the RSI reading would reflect maintenance of the bearish momentum,” comments Mr. Yang. “The bearish outlook is at the moment contained above the 200SMA in the daily chart. Therefore, if we clear below the recent low of 83.12, we can open up lower support pivots, 82.20 in the very short-term (50% retracement and channel support).”

At the time of writing, AUD/JPY has closed the American session at 84.64, 30 pips below its starting price. To the downside, immediate support lies at 84.27 (July 18 high) and, below there, 84.05 (June 20 low). To the upside, resistance levels lie at 84.95 (June 3 low) and 85.20 (20-day EMA).

Forex: EUR/USD regains 1.4200, nears daily highs

 

EUR/USD is back headed north after staging a limited bearish correction, having risen near 70 pips from lows back above the 1.4200 mark.

EUR/USD reached a fresh session high at 1.4234 within the last hour, just 5 pips shy of its 4−day high struck earlier, although uncertainty has been capping further gains in the hegemonic currency ahead of the euro zone summit on Thursday.

At time of writing, EUR/USD is quoting at the 1.4225 area, recording a 0.50% gain on the day. On the upside, next resistance lies at the 1.4240/50 zone and then 1.4285, while on the downside, immediate support could be found at 1.4190 ahead of 1.4165....

Forex: 14% odds for EUR/CHF to reach parity before year end - BBH

Analyzing the options market and using current spot and implied volatility, Brown Brothers Harriman estimates that the odds that the EUR/CHF could reached 1.00 before the end of the year is about 14% and it rises to 35% considering the next 12 months. “While not the odds-on favorite, it seems sufficiently high that it cannot be simply ignored,” wrote Marc Chandler, Global Head of Currency Strategy.

Chandler affirms that recent global debt crisis and in particular the European debt crisis, put the Swiss Franc safe haven function “on steroids”. This is not good new for Swiss equities. “The appreciation of the Swiss franc against the euro is one of the reasons why the Swiss Market Index (SMI) has generally underperformed,” Chandler noted.

Forex: CHF gains momentum across the board

 

The Swiss Franc strengthened in the last hour following the release of the IMF report on Europe. USD/CHF erased gains and pulled back below 0.8200 and fell to 0.8162, the lowest level since Asian hours. The pair moved further away from 0.8232 (daily highs). 

The Swiss Franc also rose considerably in the last hour versus its European rivals. EUR/CHF peaked at 1.1670 but reversed and turned to the downside falling a hundred pips in less than 60 minutes. The pair retreated to 1.1555, area that lies just a few pips above today’s opening price. GBP/CHF also tumbled in the last hour, falling from 1.3267 to 1.3153 and trimmed gains.

The IMF presented a report on Euro Area policies and affirmed that Executive Directors see that the Euro debt crisis poses risks to the European and to the global recovery. They called for strong policy implementations in the programs, more efforts to restore confidence and to strengthen the economic governance.

“Directors stressed a number of essential actions. First, they urged a rapid implementation of the commitment to scale up the capacity of the European Financial Stability Facility (EFSF) and supported a more flexible use of the EFSF as a backstop for sovereign and banking problems. Second, Directors called for clarity in the approach to private sector involvement with regard to ongoing programs and in the context of the European Stability Mechanism. And third, they called for immediate measures to strengthen the financial system through adequate capitalization and a strong follow up to the stress-test.”

Forex: NZD/USD at new record highs

The Kiwi resumed the upside against the Dollar after moving in ranges for a few days and reached a new record high at 0.8572. NZD/USD broke above 0.8505 and jumped to the upside.

“The NZD/USD pair fell on Monday, but bounced towards the end of the day again as it appears the uptrend simply is too strong to cause any significant drop in price for more than a few hours. The pair is a bull pair, and buying is the only thing to do. We like buying this pair on dips, and will not sell it,” the Forex mansion Team said.

So far, the pair is rising for the fourth consecutive week in a row. In the last seven days it has risen 450 pips.

The Kiwi is outperforming the Aussie and the Loonie. AUD/NZD fell below 1.2500 and bottomed at 1.2478, the lowest price in 11 months while NZD/CAD reached earlier at 0.8147 the highest price since 2008.

Forex Flash: Risk of BOJ intervention is low - BBH

The Japanese yen in recent days has remained mostly steady near it´s lowest level since the earthquake in March, holding within a tight range around 79.00 since late Thursday. Still the BBH Global Currency Strategy team suggests: “Given the low volatility and the US and European debt tensions, we continue to suspect that the risk of BOJ intervention is low. At the same time, as the euro zone economy appears to be losing momentum and the US economy is disappointing, the Japanese economy looks poised stage a stronger recovery in the coming months.”

The BBH analysts adds: “We note that the Nikkei is the best performing G7 equity market over the past month. Foreign investors had been substantial buyers of Japanese share in the first part of the year (~$40 bln through April), repatriated some money in Q2 but in recent weeks have returned to the buy side again.”

Forex: EUR/USD unable to hold above 1.4200

EUR/USD fell back below 1.4200 in the American afternoon after failing for second time on Tuesday to extend gains above the 1.4210/15 zone where the pair set a 3-day high earlier. Despite the risk-on environment, the hegemonic currency was unable consolidate above 1.4200 against the Greenback, weighed down by the IMF saying that contagion risk in the euro zone is high, and dropped near 60 pips back to the 1.4150 region.

EUR/USD has been trading between 1.4150 and 1.4210 most of the New York session, unable to set a fresh direction, and currently it is quoting at 1.4160, holding onto a 0.35% gain.

If the Euro manages to break through 1.4210, next resistance could be found at the 1.4250 zone and 1.4280, while if it falls below 1.4150/45, immediate supports might be found at 1.4130 and the 1.4100/1.4090 region.

Forex Flash: USD/CAD targets 1.00 over 1m & 3m – UBS

 

With the BoC monetary policy decision in focus today, the USD/CAD remains mostly bearish around 0.9550. Chris Walker of UBS informs: "Our Canadian economist is in line with consensus, and expects the base rate to be kept unchanged at today's policy meeting. As far as the policy statement is concerned, we would not be surprised to see mildly hawkish overtones seep into the text, given that CPI in May showed a significant increase.”

Given the possibility of the Canadian central bank turning more hawkish, Walker places both the 1-month as well as 3-month target at 1.00.

Forex: GBP/USD pulls back from 1.6160

 Cable was unable to sustain bullish momentum which brought it nearly 100 pips higher in the last few hours of trade to a high of 1.6160, and has since pulled back towards 1.6100 by mid-day over the old continent. The pair seems to find modest support their however, and currently trades settled at 1.6120 in wait of fresh direction.

The technical analysts over at AceTrader suggest: “Although cable has eased after intra-day rally to 1.6148 and sideways trading would be seen, as long as near term support at 1.6107 holds, bullishness remains for upmove from yesterday's low of 1.6005 to extend gain towards 1.6165 but resistance at 1.6195 would hold from here.”

They go on to state: “Buy again on dips with stop as indicated, break would risk stronger pullback to 1.6055.”

Forex: EUR/CHF consolidates above 1.1600

The EUR/CHF continues to pull back from the Sunday night historic low of 1.1375 given the eurozone debt jitters, today supported by a slighlty improved risk sentiment which has allowed the pair to jump some 130 pips over the European session and reach as high as 1.1650 by mid-day.

The pair has since run into firm resistance at that mark as traders re-evaluate and wait for further direction, trading currently quiet around 1.1620. If the EUR/CHF manages to extend further above however, expect resistance past previous levels at 1.1723 (High July 13, 10-Da MA), 1.1751 (Daily High Jul 12) and 1.1808 (Daly Low Jun 27).

In the case of a reversal, support is placed at 1.1516 (Hourly Low Jul 19), 1.1399 (21-Day Lower Bolli) and 1.1365 (Historic Low Jul 18).

Forex: USD/CAD downside limited at 0.9540

The USD/CAD has come under broad selling pressure today as the dollar weakens on higher risk taking spurring crude prices slightly higher. The pair dropped another 50 pips over the European session, hitting a low near 0.9540 befoe running into apparently firm support and pulling back towards 0.9560 where it remains at time of writing.

While still overall bearish, if the USD/CAD breaks lower in the coming hours further critical levels past previously mentioned support are listed at 0.9527 (Daily Low Jul 18), 0.9513 (Daily Low May 11) and 0.9505 (Daily Low May 4). Above, resistance is placed at 0.9635 (Daily High Jul 18), 0.9667 (21-Day MA) and 0.9668 (July 13 High).

Forex: GBP/USD remains above 1.6000, bearish tone intact

GBP/USD opened Monday’s trade at 1.6105, broke below key support in the 1.6075 area to hit session lows near 1.6000 and has recovered some of its daily losses, hovering now just above the 200-day EMA.

“Note the RSI reading finally broke below 40 to kill the bullish momentum, and even shows some short-term bearish momentum as the reading kissed 30,” explains Fan Yang, Chief Technical Strategist at FXTimes. “At the second half of today’s US session, we are seeing some pullback after the strong bearish candle from a little earlier.”

Mr. Yang continues: “If the market fails to break above 1.6075 in the Asian session, and can avoid breaking back above the 1.6110 level in the upcoming European session (in about 12hours), then the bearish outlook is still valid, at least in the very short-term towards 1.5930-1.5940 area.”

At the time of writing, GBP/USD has closed the American session at 1.6055, around 50 pips below its starting price. If the cross continues its descent during the Asian trade, Slobodan Drvenica of Windsor Brokers Ltd. expects buying interest at 1.6050, 1.6030 and 1.6000. To the upside, he recognizes resistance at 1.6127, 1.6164 and 1.6192.

Forex: USD/CHF consolidates below 0.8200

Despite the risk-off environment, the Dollar has managed to regain ground against the Swissy after opening Monday's Asian session near all-time lows at the 0.8085 zone. However, after rising 100 pips along the day, USD/CHF found resistance at the 0.8185/80 region during American hours and has been consolidating in a narrow range just below ever since, currently at 0.8170.

"Current recovery attempt is so far seen capped at 0.8200, with break here required to signal stronger correction towards 0.8273/0.8300", said Slobodan Drvenica, analyst at Windsor Brokers Ltd. "Holding below 0.8200, however, keeps bears in play for fresh attempt through 0.8073, towards 0.8000/0.7900 targets".

Forex: EUR/USD drops back towards 1.4020

 

The EUR/USD is once again coming under modest selling pressure, dropping some 50 pips in the last hour to test daily lows near 1.4020. The pair appears to be catching slight support at that level, yet still remains ready to break towards 1.4000 as overall sentiment worsens over New York.

Writing for FXstreet Independent Analysis team, Valeria Bednarik suggests: “Risk environment amid sovereign debt woes continues dominating the scenes, with European share markets negative, and gold quoting around fresh record highs above $ 1600/oz. Recent US disappointing data however, favored a limited recovery in the cross, still limited below 20 SMA in the hourly chart, and with indicators heading south below their midlines.”

Bednarik adds: “Bigger time frames show momentum still heading south, while strong static resistance area around 1.4090, intraday highs and lows from the last days.”

Forex: EUR/GBP rejected at 0.8700

 

The EUR/GBP found firm support at a fresh 6−week low this morning at 0.8704, reversing course over the European session as risk aversion wanes slightly from what it was over the Asian markets. The pair still remains some 40 pips off the day´s opening price at 0.8780 at time of writing, and could possible retest those recently mentioned minimum levels if sentiment turns lower suddenly once again.

As we head towards mid-day over Europe, the EUR/GBP looks poised for a modest recovery with the immediate resistance levels listed at 0.8795 (High May 15, 100 Day MA), 0.8831 (55-Day MA9 and 0.8842 (10-Day MA). A re-test of lows will bring support at 0.8675 (Daily Low May 31), 0.8663 (200-Day MA) and 0.8658 (Daily Low May 30).

Forex: EUR/USD curbs downside at 1.4015

The EUR came under heavy selling pressure to open the week as overall uncertainty on both sides of the Atlantic keeps markets jittery, however the EUR/USD finally found technical support around 1.4015 in morning trade over the old continent, nearly 150 pips under the day´s opening price. The pair currently has recovered back up towards 1.4050 where it trades quietly at time of writing.

Technically speaking, Stoyan Mihaylov of Deltastock writes: “EUR/USD is in a consolidation after the recent top at 1.4941 (May 4th, 2011). Technical indicators are descending and trading is situated between the 50- and 200-Day SMA, currently projected at 1.4311 and 1.3636.”

Mihaylov adds: “Still in the descending corrective channel below 1.4281 high and the intraday bias is negative with an initial resistance at 1.4090. I continue to favor a reversal for a break through 1.4090 and 1.4199, en route to 1.4370. Major support on the downside is 1.3950.”

Forex: USD/CHF pares initial sell-off

The USD/CHF dropped to a fresh historic low of 0.8042 in early trade over Asia, as overall uncertainty regarding the US and Eurozone debt situations drove investors to the safety of the Swiss franc. The pair has since battled back to the day´s opening price of 0.8150 however, remaining consolidated around their in morning trade over Europe.

Techincally, the Kshitij Consultancy Services team writes: “Dollar-Swiss has seen a downside breakout of its 0.8300-8550 sideways range. The overall downtrend remains intact. With Support-turned-Resistance in 0.8280-8300 region, the outlook remains bearish for a fall to 0.8070-50-8000 or even 0.7950 in the coming weeks. 0.8070 is a significant Support level seen on the downside and while it holds, we migth see a rally to 0.8250-8300.”

They add: “A break above 0.8300 is not looking likely. However, if seen, the upmove can extend to 0.8400. Remember the pair is finding Resistance near 0.8200 itself, as such the upmove could be well restricted to 0.8200 itself.”

Eurozone: 8 banks fail the stress test, 5 Spanish institutions

8 European banks has failed 2011 stress test according to the European Banking Authority inform released today. Five Spanish, two Greek and one Austrian banks haven't pass the test. All Irish banks have passed as well as German institutions. The 2011 test has counted 91 banks across 21 European countries.

EUR/USD reacts up and breaks 1.4180.

Forex Flash: EUR/USD is likely to trend sideways - Commerzbank

 

Even though the EBA published the stress tests results, showing that only 8 of 90 banks failed the tests giving the Euro some relief, "the Euro zone politicians are still struggling for a solution to the sovereign debt crisis after the situation escalated last week", said Antje Praefck, analyst at Commerzbank. 

Meanwhile, "in the USA, the debate over the raising of the debt ceiling is becoming more and more urgent. There is a chance of a US default at the beginning of August if the government and opposition cannot come to an agreement. The rating agency Moody’s has therefore placed the country's rating under review for a possible downgrade," said Praefck.

"Against this background, general uncertainty in the currency markets remains high. Depending on the news flow, sometimes USD and sometimes EUR will come under greater pressure… All this points to choppy, volatile sideways trading in EUR-USD over the coming days", added Antje Praefck.

Forex: Euro slightly lower after stress test results

The Euro held relatively calm following the release of the stress test results. EUR/CHF rose initially to 1.1575 but retreats afterwards to 1.1520, 30 pips below the price it had before the releases. Similar movements showed EUR/GBP that climbed to 0.8780 but pulled back after a few minutes to 0.8755. Against commodity currencies the Euro turned lower approaching session lows versus the Kiwi and the Loonie.

The results showed that 8 banks failed. The European Banking Authority said: “Eight banks fall below the capital threshold of 5% CT1R over the two-year time horizon, with an overall CT1 shortfall of EUR2.5 bn. Sixteen banks display a CT1R of between 5% and 6%.”

Forex: EUR/USD short-lived rally after stress tests results

EUR/USD jumped toward session highs after the European Banking Authority (EBA) published the results of the last stress tests to European banks, showing that only 8 out of 91 banks failed of which 5 are Spanish, 2 Greek, 1 Austrian. The EU regulator said that other 16 banks narrowly passed the tests.

The Euro rose to 1.4187 on a relief rally but quickly moved back to pre-results levels. At time of writing, EUR/USD is quoting at the 1.4150/60 area, 0.10% above its Friday's opening price.

From a technical perspective, Valeria Bednarik, analyst at FXstreet said, "Pair remains hovering near 1.4160 strong Fibonacci resistance area, and despite a failure attempt to break higher, price quickly retreated from 1.4190 session high. Despite a timid bullish tone as per price holding above 20 SMA, pair needs at least to break daily highs, to gain ground towards 1.4250 area".

"Below 1.4100, the bearish trend may take the lead, with the pair then pointing for an approach to 1.4050 support zone", said Bednarik.

Forex: Dollar weakens ahead of stress test results

The US Dollar weakened in the market ahead of the release of the release of the European stress test results. EUR/USD rose above 1.4100 to test levels on top of 1.4150 while GBP/USD broke above intra-day resistance level at 1.6130/35 and reached 1.6155 approaching daily highs.

The Loonie and the Kiwi rose further against the Dollar. USD/CAD hit a new daily low at 0.9535 while NZD/USD eared losses and climbed to challenge daily highs around 0.8445. AUD/USD remains moving in a range, with support at 1.0625 and resistance at 1.0675.

Despite recovering against the Dollar, the Euro remains near session lows across the board. In a few minutes, at 16:00 GMT the results will be published.

Forex: AUD/USD holds above 1.0625

The AUD/USD dropped sharply earlier and found support around the 1.0625. The mention support was tested after Wall Street opening and managed to hold. To the upside, the recovery of the Aussie was capped by the 1.0675 zone. Currently AUD/USD trades at 1.0650, 0.70% below today’s opening price, and continues to move sideways consolidating losses ahead of the release of the European stress test results.

“The sideways range of 1.0500-0800 remains intact and it is now trading at the middle of this range. A breakout of this sideways range will determine the further direction of move,” wrote the Kshitij Consultancy Services Team.

Forex: EUR/USD eases to 1.4100 ahead of Stress tests

 

Euro recovery from 1.4095 lows on early European session has been capped at 1.4180, and the pair has pulled lower afterwards, giving away previous gains and returning to 1.4100 as investors square positions ahead of the release of EU banks' stress tests.

On the downside, the pair might find support at 1.4095 (day low), and below here, 1.4035 (intra-day level) and 1.3950 (intra-day level). On the upside resistance levels lie at 1.4200 (day high), and above here, 1.4280 (Jul 14 high), and above here, 1.4370/75 (Jul 7/8 highs).

The results of the stress tests could determine Euro direction, according to Kathy Lien, Director of Global Research & Analysis for GFT, with 15 being the magic number: "If more than 15 banks fail, the EUR/USD could extend below 1.41. If less than 15 banks fail, the EUR/USD will rally."

Forex Flash: USD/CHF seen at 0.9700 next year - Wells Fargo

The Swiss Franc has been rallying continuously for the last 12 months and, according to the Wells Fargo FX Express - Monthly, reaching overstretched levels, which could lead to a trend shift if Eurozone debt stabilizes and the US gets through the "soft Patch".

The USD/CHF s expected to appreciate steadily in the mid-term, according to the Wells Fargo FX Express, reaching 0.8300 area in 3-months time, and 0.8400 by year end, to extend gains to 0.9025 by mid 2012 and rally towards 0.9700 in the second half of 2007.

US GOLD - Comex gold seen as top-heavy as record-breaking week comes to an end

New York 15/07/2011 - Gold on the Comex division of the New York Mercantile Exchange fell modestly on Friday, with the recent rally to fresh records highs prompting the sale of physical metal and general profit-taking.

Gold futures for August delivery were last down $3.30 at $1,586.00 per ounce and from Thursday’s all-time record high $1,594.90.

After the big run-up this week, gold is starting to feel a bit overcrowded, a US-based gold trader said.

“Case in point, my great aunt from Tennessee called me [on Thursday] morning to inform me that her church group was pooling some money together to buy gold coins and that if I were smart I would do the same,” the trader said.

“It's almost certainly a good time to sell off some positions the moment you start getting random trading advice from distant relatives whom you normally only see at family reunions,” he added.

Gold is also facing some headwinds from the physical market due to the higher prices, Standard Bank said in a note.

“Physical selling and scrap gold coming to the market has outpaced buying for the fourth day, pushing our Standard Bank Gold Physical Flow Index (GPFI) into negative territory for the first time since late-April,” it said, adding that physical selling is the strongest it has been in 13 months.

Additionally, Federal Reserve chief Ben Bernanke, in testimony before the Senate on Thursday, clarified earlier comments related to the possibility of a third phase of so-called quantitative easing (QE3).

He told the Senate sub-committee that additional accommodative policies might be considered at some point but that the Fed has no plans to change its policies in the immediate future.

Those comments were interpreted by the market to be less dovish than what he had said before the House on Wednesday.

“This has dented expectations of QE3, thereby reducing appetite for precious metals from a liquidity perspective,” Standard Bank said.

Having hit fresh lifetime highs this week, gold is now starting to look a bit top-heavy but remains supported on anxiety over European bank stress test results that are due out later today, RBC Capital Markets said in a note.

“As it's Friday and book-squaring is often the name of the game, we would not be surprised to a see a further pullback… those lucky enough to have gotten long early in the week will look to book profits,” it said.

In wider markets, the dollar was down against the euro at 1.4117, down about half a cent on the day.

Forex: GBP/USD remains rangebound above 1.6100

 

The sharp rally that led GBP/USD toward a 3−week high at 1.6192 on the back of Moody's placing the US rating on revision for downgrade late Wednesday, eased along the European session and the pair entered in a consolidation range that has held during American hours.

GBP/USD retreated from highs but the correction was limited by the 1.6090 zone, and the cross has spent most of the NY session above that level but capped by 1.6160. At time of writing, the pair is quoting at 1.6135, 0.22% above its opening price.

From a technical perspective, Valeria Bednarik, chief analyst at FXstreet, recently commented, "Holding steady above 1.6080 area, the pair has a shy bearish momentum in the hourly chart while price hovers around a flat 20 SMA and contradicts indicators, as the pair moves on market sentiment rather than anything else. 4 hours chart, shows current candle managed to open firm above 200 EMA, helping keep the downside limited".

Forex: USD/CHF fails to rise back above 0.8200 returns to 0.8155

Greenback reached a fresh daily high at 0.8199 against the Swiss Franc but lost strength and pulled back toward 0.8150. Despite retreating, USD/CHF is holding far all time lows recorded during Asian morning when it bottomed at 0.8083.

“Corrective action on extremely overextended hourly studies is seen preceding fresh weakness, with 0.8000, then 0.7900 levels in focus, as wider picture outlook remains firmly bearish,” said Slobodan Drvenica, analyst at Windsor Brokers Ltd.

On a weekly basis the pair is headed toward the second decline in a row and to the biggest weekly loss since late May.

The Swiss Franc also strengthened versus the Pound and the Euro in the last hours and trimmed losses. EUR/CHF pulled back below 1.1600 while GBP/CHF was rejected from levels on top of 1.3200.

Bernanke: Fed not ready to increase stimulus at this point

Ben Bernanke testified before Congress for the second day in a row, this time at the Senate Banking Committee. According to the Chairman the central bank is not prepared at this point to take further action, signaling that the Fed would wait to see how the economy progress before taking further actions to stimulate the economy.

Regarding inflation, Fed’s chairman mentioned that currently is higher and closer to the target the central bank has. The increase in prices is among the reasons why the Fed won’t start soon another round of QE. Also he affirmed that it may not be effective to increase asset purchases but current state of the economy forces the bank to examine way to stimulate growth if needed.

Forex: USD/CAD hits 2-months lows and rebounds

The Loonie rose following the release of US economic data and reached a 2-month high but it failed to rally further and retreated. USD/CAD tumbled to 0.9548, the lowest price since May 11 but rebounded and in the last hour accelerated to the upside, approaching 0.9600. Currently trades at 0.9594/98, 0.09% above today’s opening price.

Recent decline of the Loonie was accompanied by a decline in crude oil and stock indexes. The Dow Jones trimmed gains and currently gains 0.11% and the Nasdaq is now in negative territory falling 0.33%. Market sentiment weakened as Ben Bernanke testifies before Congress and following mix data from the US.

From a technical perspective, USD/CAD support levels according to Mataf lie at 0.9450, 0.9520 and 0.9560 while resistance at 0.9610, 0.9665 and 0.9780.

Forex: EUR/USD dips below 1.4200, hits fresh daily low

The Euro weakened in the market and pulled back. EUR/USD failed to hold above 1.4200 and fell sharply in the last hour losing almost a hundred pips. The pair dropped from 1.4235 to 1.4140, hitting a new daily low. The Euro managed to rebound and rise back above 1.4150, but remains facing pressure as risk aversion sets in.

From a technical perspective, according to Fan Yang, Chief Technical Strategist at FXTimes the EUR/USD is at the crossroad with a mix of bullish and bearish signals. “The 4H chart also has a mix of signals. The bullish signal is a break above a declining resistance, as well as the ability to break back into the triangle. Still, the market has a chance to confirm by not heading higher. A rally above 1.4340 area, the middle of the previous triangle, and then above the 200SMA in the 4H chart, should push the market to the bullish side.”

Market movements continue to be moderated as investors start to center its attention on tomorrow’s European streets test results.

Forex: USD/JPY declines, support at 78.65

 

Thanks to breaking news that Moody's placement of US Aaa government bond rating and related ratings on review for possible downgrade, the Japanese yen is extending its decline against the Greenback in early Asia.

The dollar had already been taking a beating, seen declining throughout the market after Bernanke’s testimony in Congress on Wednesday, but at the close of the American session, USD/JPY began its campaign to target lower levels, extending its decline to lows below 78.65 before bouncing slightly, last quoted in the 78.75 price zone, down from 78.98.

Forex: GBP/USD jumps to 3-week highs as Moody’s warns US

GBP/USD soared and broke above the 1.6120 resistance zone, reaching at 1.6173, a 3-week high. The pair remains trading near the highs extending its rally that started during Wednesday’s American session following Ben Bernanke opening statement.

“Technical studies indicate that support levels are located at 1.5948/06 and then at the 21Day Lower Bollinger Level at 1.5873,” said the Talking-Forex analysis team. According to them resistance levels are noted at the 100-DMA line at 1.6250, 1.6263 and then at 1.6283.

The Dollar weakened in the market recently after Moody's put US Aaa Rating on a review for a possible downgrade.

From Tuesday’s lows GBP/USD has risen almost 400 pips and posted on Wednesday the biggest daily gain since late February.

Forex: Swissy climbs vs. majors, USD tanks

The Swiss franc has gained sharply versus its European and American counterparts in recent weeks.

Wednesday’s session saw the CHF appreciate the most against the US dollar since the 27th day of March, dropping around 160 pips from its start price of 0.8303. This price action came on the back of a weak Greenback after US Fed Chairman, Ben Bernanke testified in Congress.

"The comments were not upbeat by any means, and obviously, no one wants the economy to get to the point where more stimulus is needed," comments Richard Sichel, chief investment officer of Philadelphia Trust Co.

The franc has strengthened versus the euro as investors seek a refuge from the ongoing debt crisis in the euro region, particularly as Fitch Ratings on Wednesday downgraded Greece deeper into junk territory, citing the absence of a new and fully funded financing program for the country.

The dollar is now extending its decline against its major rivals as Moody's Places US Aaa Government Bond Rating and Related Ratings on Review for Possible Downgrade.

The Swiss currency has risen about 11% versus its euro-zone and U.S. counterparts in the past three months. At the time of writing, USD/CHF is under pressure in early Asia, quoted at 0.8110, down from 0.8176. Versus the Euro, the Swiss currency is quoted a 1.1510, down from 1.1576.

Forex: USD/CAD edging towards 0.9600

 

The high risk aversion seen in recent days which pressured commodity currencies to weaken across the board has given way, allowing the USD/CAD to drop back towards the 0.9600 mark where it traded around prior to the sell−off. Today the pair has dropped around 60 pips from it's opening price, appearing to find modest support around the technical barrier ahead of the North American session.

If the USD/CAD manages to break past that level, expect further critical levels to present themselves at 0.9564 (Daily Low Jul 8), 0.9524 (21-Day Lower Bolli) and 0.9513 (Daily Low May 11). Above, resistance is placed at 0.9646 (Hourly High Jul 13), 0.9693 (100-Day MA) and 0.9780 (61.8% of 0.9564 -0.9914).

Forex: AUD/USD rallies to 1.0700 on strong Gold prices

Australian Dollar's retreat from 1.0790 bottomed yesterday at 1.0520 low and the pair has bounced up strongly on Wednesday, favoured by higher Gold prices, reaching day highs at 1.0695, the 61.8% Fibonacci retracement level of Jul 8-12 decline.

Immediate resistance, thus, lies at the mentioned 1.0695 (Fib retracement level), and above here, 1.0725/35 (Jul 11 highs) and 1.0790 (Jul 11 highs). On the downside, support levels are 1.0655 (intra-day level), and below here, 1.0580 (day low) and 1.0525 (jul 12 low).

Technical indicators show increasing bullish momentum in 4 hour charts, according to Valeria Bednarik, analyst at FXstreet: " 4 hours chart shows an increasing bullish momentum, with current candle opening just above a still bearish 20 SMA, while indicators approach downside up to their midlines."

Forex: USD/JPY recovery, capped below 79.55

Dollar decline from Friday's high at 81.50 extended sharply yesterday as risk aversion boosted Yen demand, breaking below key 79.55/70 support area, to hit a fresh 4-month low at 78.50, and the pair attempted to regain lost ground on Asian session, although 79.55 has limited the upside.

On the downside, the pair might find support at 79.10 (day low), and below here, 78.50 (Jun 12 low), and then 78.00. On the upside, immediate resistance lies at 79.55/70 (May 5/Jun 8 lows), above here, at 80.00 (psychological level), and 80.35 (Jul 12 high).

Yesterday's daily close below 79.55 supports further bearish activity for today, according to the ecPulse technical analysis team: "This breach support the expectations for the pair to continue the expected intraday downside trend for today, and supported by the negative pressures forced by the MA 50."

Forex Flash: USD/CAD: Key support at 0.9565 - Commerzbank

The Dollar has bounced off the breached downtrend resistance line off Aug 2010 highs, and, according to Axel Rudolph, technical analyst at Commerzbank, increasing the odds for a revisit to the 200-day MA at 0.9875, if the pair holds above 0.9565.

If the pair holds above 0.9565, it could extend its recovery to the 200-day MA, at 0.9874, says Rudolph: "A continued advance to the 200 day moving average at .9874 may now be in the making, provided that no drop
through this week’s low at .9565 occurs."

On the downside, below 0.9565, Rudolph sees the pair heading to 0.9527/.9449: "Should this be the case, though, the .9527/.9449 support area (early April and mid-May lows and May trough) will be back in the limelight."

Forex: EUR/USD on recovery, nears 1.4100

Euro sell off seen on Monday and Tuesday has found support at fresh 4-month low 1.3835, to bounce up as fears about a massive debt contagion in the Euro Area ebb, regaining 1.4000 level during Asian session, to extend gains in Europe, reaching day highs at 1.4090.

On the upside, if the Euro manages to hold above 1.4055/60, next resistance levels would be at 1.4180 (broken trendline support), and above here, 1.4230 (Jul 11 high).

On the downside, support levels are 1.3950 (day low), and below here, 1.3900 (intra-day level) and 1.3835 (Jul 12 low).

Forex: EUR/USD pulls back after Ireland downgrade

The Euro lost momentum across the board after Moody's Investor Service downgraded Ireland rating one notch to Ba1, losing the "investment grade". EUR/USD retreated sharply from 1.4050, falling almost a hundred pips to 1.3960.

The outlook for Ireland remains negative and according to Moody’s the key driver for today’s decision “is the growing possibility that following the end of the current EU/IMF support programme at year-end 2013 Ireland is likely to need further rounds of official financing before it can return to the private market, and the increasing possibility that private sector creditor participation will be required as a precondition for such additional support, in line with recent EU government proposals.”

The EUR/USD currently trades at 1.3970, on its way to the third decline in a row and headed toward the first daily close below 1.40 since March 15. 

Forex: USD/CHF nears all time low after FOMC

The US dollar weakened short after the Fed published its last meeting minutes that showed some members are willing to provide further monetary stimulus if economic growth remains too slow to make satisfactory progress toward reducing the unemployment rate.

USD/CHF dropped around 50 pips after the minutes and touched a fresh 2-week low at 0.8280, just 6 pips shy of 0.8274 where the pair set its all time low on Jun 28th. At time of writing, USD/CHF is trading at the 0.8300 area, where it prints a 0.68% loss on Tuesday.

Forex: Dollar falls after FOMC minutes

 

The Dollar extended its retreated across the broad following the release of the FOMC minutes. EUR/USD broke above 1.4025 and rose to test daily highs while GBP/USD also rose above previous American session highs and reached levels on top of 1.5940.

Commodity currencies gained momentum supported by rising stocks. In Wall Street, the Dow Jones turned higher after the minutes and currently is up 0.43% while the Nasdaq erased losses and is now rising 0.3%,

The Swiss Franc and the Yen jumped versus the Dollar and reached fresh highs. USD/CHF plummeted 50 pips and dropped back under 0.8300, approaching all time lows. USD/JPY fell to test daily lows.

The minutes showed discussions about how to remove monetary stimulus but no agreement on a specific guideline. “Few members” pointed out that if economic growth becomes too slow more stimulus would be needed. 

FOMC: Discusses exit strategy, need for further stimulus

Fed June meeting minutes show all but one official agreed on key elements of exit strategy while making clear that the discussion "did not imply that a move toward such normalization would necessarily begin sometime soon".

The Committee considered a set of specific principles that would guide its strategy of normalizing the stance and conduct of monetary policy. The suggested order of an exit is first to cease reinvesting principal on bonds it holds, and then either simultaneously or soon after change the forward guidance on the federal funds rate, followed by raising the target for federal funds rate, then selling agency securities after the first hike.

However, a few Fed officials suggested that the central bank may have to consider further stimulus measures instead if growth remains too slow. "Participants also discussed the medium-term outlook for monetary policy. Some participants noted that if economic growth remained too slow to make satisfactory progress toward reducing the unemployment rate and if inflation returned to relatively low levels after the effects of recent transitory shocks dissipated, it would be appropriate to provide additional monetary policy accommodation", the Federal Open Market committee said in the minutes of its June 21-22 meeting.

Forex: EUR/USD tests levels above 1.4020

The EUR/USD tested levels above the 1.4020 zone that capped the upside during the European session. The pair trimmed losses and currently is trading less than 40 pips below the price it had at the beginning of the day after reaching at 1.4026 a new American session high.

“The EUR/USD has found support to bounce after a quick reaction of Italian and in general the euro zone area to latest developments of the crisis, and much worse than expected US Trade Balance,” said Valeria Bednarik, collaborator at FXstreet.

From a technical perspective, Bednarik pointed out that the EUR/USD “seems ready to regain 1.4000 as indicators began a correction from oversold extremes, and extend gains towards the 1.4060/80 area, once recent intraday high at 1.4025 is overcome.”

The Euro moved off session lows across the board but still remains trading with losses.

US GOLD - Comex gold gains on persistent sovereign-debt crisis, euro comes off lows

New York 12/07/2011 - Gold on the Comex division of the New York Mercantile Exchange edged into positive territory on Tuesday after the euro bounced off a four-month low following the sale of Italian Treasuries.

Gold futures for August delivery were last up $4.20 at $1,553.40 per ounce in New York. Trade has ranged from $1,541.10 to $1,556.10.

The European common currency has been hammered over the past 48 hours when fears over sovereign-debt contagion in the eurozone sparked a flight to safety. The euro fell to 1.3834 against the dollar earlier this morning - its lowest since March 11.

“The gold market, given the total environment, is doing quite well. The continued problems in Europe are prompting gold buying across the continent,” Sterling Smith, an analyst with Country Hedging, said. “The market remains very nervous about moving into any sort of paper asset.”

But the euro has since recovered somewhat to 1.40004 due to speculation that ECB has been buying up peripheral eurozone debt.

Additionally, the successful completion of a one-year Italian Treasury bill auction lent temporary support to the single currency.

“Those two pieces of news provided the market with a brief sigh of relief. The euro rallied and the stock markets fared a little better,” Smith said.

Nevertheless, the euro does appear to be moving into a longer term bear market, he added.

“While that's bullish for the dollar index, its not going to have that big of an effect on the gold market,” Smith said. “It's certainly possible for gold to rally even if the dollar also goes up. People aren't in love with the dollar - they simply see it as the least offensive choice at this moment.”

Elsewhere, talks to raise the US debt ceiling from $14.3 trillion are stalling, which may be “encouraging a little [gold] buying as well”, Smith said.. The Treasury Department has said that Congress has until August 2 to act or risk a credit event.

The market also awaits the release of the minutes from the Federal Open Market Committee's (FOMC) June meeting later today.

“While we don’t expect anything unusual, last week’s extremely disappointing non-farm payrolls figures might have raised market expectations for another round of quantitative easing (QE3),” Standard Bank said in a note.

“Further monetary accommodation by the Fed would be unequivocally bullish for gold. For today though we don’t expect the Fed to make any concrete commitment to additional monetary support, but don’t discount that the market might be moved by a possibly more dovish tone,” it added.

In other precious metals, Comex silver for September delivery was last down 31.8 cents at $35.380 per ounce. Trade has ranged from $34.810 to $36.075.

Platinum futures for October delivery on the Nymex were up $2.80 at $1,731.10 per ounce, while the September palladium contract was down $3.15 at $764.30.

Forex: USD/CHF trades near 2-week lows

USD/CHF is trading near its 2-week low struck earlier at 0.8312 after a limited Greenback bounce as risk aversion eased somewhat. USD/CHF was unable to extend the recovery from lows above the 0.8365 area and it retreated to the 0.8325 zone.

At time of writing, USD/CHF is quoting at the 0.8330 region, where it is 0.32% below its opening price. USD/CHF is falling for third straight day as the Franc has been supported by the risk-off environment.

From a technical perspective, Slobodan Drvenica, analyst at Windsor Brokers Ltd, said, "Recovery attempt from yesterday’s low at 0.8328 was short-lived, as gains were capped by 20 day MA, at 0.8396. Subsequent weakness reached fresh low at 0.8311, confirming negative structure and looking for test of 0.8300/0.8273 lows, below which to open fresh phase lower and post new record lows. On the upside, 0.8400 offers strong resistance".

Wall Street wavers after sharp slide

US stock indexes are wavering between small gains and losses on Tuesday a day after the biggest global sell-off since March, amid deepening concerns about the euro zone debt crisis as European officials for the first time refused to rule out default by Greece.

The Dow Jones industrial average is down 12 points or 0.10% at 12,493. The Standard & Poor's 500 Index drops 1 point or 0.11% at 1,318. The Nasdaq Composite Index is down 8 points, or 0.31% at 2,793.

In the macroeconomic domain, a report showed the US trade deficit widened in May to -$50.2 billion from a revised -$43.6 billion in April. Consensus was around a deficit of -$44.1 billion.

In the FX market, the Euro pared losses against the Greenback. Oil has erased previous intraday losses and is above $95 a barrel, while gold hovers around $1550 an ounce.