EURUSD Movement
For the 24 hours to 23:00 GMT, EUR declined 0.31% against the USD and closed at 1.2537, amid renewed worries about Euro-zone’s financial health following fears that Spanish government might need to use sovereign debt to support its financial institution.
Initially, the Euro received some support after weekend polls result showed that Greece’s conservative New Democracy party was holding an edge over its leftist rival Syriza ahead of June 17 parliamentary elections.
However, the Euro came under pressure amid concerns over the health of Spanish bank following news that government is set to arrange a €19 billion recapitalization package for one of the country’s largest commercial lender, Bankia. The Euro extended its losses, after the yield on the 10-year bond in Spain spiked to 6.47%, highest in 2012.
Meanwhile, in bond auction, Italy sold €3.5 billion ($4.4 billion) of the zero-coupon bond maturing on 2014, with yield at 4.037%, up from 3.355% at the previous auction on April 24.
In economic news, Italian business confidence fell more-than-expected to 86.2 in May, compared to the reading of 89.1 in April.
In the Asian session, at GMT0300, the pair is trading at 1.2529, with the EUR trading 0.07% lower from yesterday’s close.
The pair is expected to find support at 1.2484, and a fall through could take it to the next support level of 1.2439. The pair is expected to find its first resistance at 1.2599, and a rise through could take it to the next resistance level of 1.2669.
Trading trends in the pair today are expected to be determined by the release of import price index and consumer price index in Germany
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
