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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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Sour Sentiment Post EU Summit

Article By: ,  Financial Analyst
May 24, 2012 9:00 AM

Sour Sentiment Post EU Summit. Markets were in discontent yesterday after the informal meeting of EU officials in Brussels, ahead of the official summit scheduled for June 28-29. The talks were centered around some sort of salvation to Greece exit, a contingency plan in case the country goes as well as the creation of Eurobonds, although it barely produced headlines of interest.
EUR/USD
Range: 1.2561 – 1.2587
Support: 1.2543
Resistance: 1.2600

Euro-dollar closed in NY at 1.2585 after getting pressed to session lows of 1.2545 as market moved into deeper risk off mode on Greek concerns. The rate had managed to recover off lows on late rumours that Germany’s Merkel was backing a bank deposit insurance scheme to 1.2601 but this talk was not confirmed after the EU Heads of State dinner and the rate drifted back to the mentioned close. The rate edged to 1.2590 in early Asia, rate was pressured lower on reaction to EU Juncker comments that he doesn’t see a launch of eurobonds soon, pressing to a low of 1.2555 before meeting decent demand interest. Large 1.2500 option barrier, adding that market is seen with positive gamma and expect buyers to emerge into dips. The rate recovered to 1.2585, settling between 1.2560-1.2585 ahead of the European open. Offers seen into 1.2600 stops above 1.2610 with more sellers above 1.2620.

GBP/USD
Range: 1.5669 – 1.5698
Support: 1.5650
Resistance: 1.5700

Cable closed in NY at 1.5690, after correcting off late lows of 1.5675 to 1.5710. Trade through Asia saw rate consolidate Wednesday’s losses, with the rate restricted to a tight 1.5675-1.5700 range, coming under fresh downside pressure into Europe as it extends lows to 1.5668 and currently holding heavy. Euro-sterling was contained in Asia by 0.8010-0.8024, after correcting off NY lows of 0.7998, with this rate so far respecting those overnight parameters leaving cable to take direction from euro-dollar. Bids seen placed toward option barrier interest at 1.5650, a break expected to meet demand into 1.5645/40 with stops below. Further demand seen at 1.5610-1.5600 ahead of 1.5580. Resistance remains at 1.5700. Euro-sterling bids remain around 0.8000, more 0.7985-0.7980.
Gold
Range: 1,554.11 – 1,562.95
Support: 1, 540.02
Resistance: 1,566.22

Gold prices plunged, dragged down by a slide in the euro as the risk of a Greek exit from the eurozone increased, triggering a sustained move out of risk assets. Reports by news agencies that eurozone officials on a teleconference of the Euro Working Group (EWG) recommended member countries make contingency plans for a Greek exit from the currency union had profoundly negative effects on the euro and gold prices. Meanwhile, comments by the German central bank that the impact of a Greek eurozone exit would be substantial but “manageable” weighed further on the euro, increased risk-averse trading, and undermined gold. Support now seen at 1,540.02 followed by 1,531.93 and then 1,518.83, resistance looks at 1,566.22, 1,574.31, and a move higher at 1,587.41.

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