As yields in Italy and Spain start to rise sharply the spotlight appears to be shifting onto classical “risk” indicators. Yesterday NZD/USD completed a Head and Shoulders top and over the rest of the week we are watching to see whether other indicators like the AUD/USD and S&P500 follow the NZD’s lead. AUD/USD below 1.0100 and the S&P500 below 1325 would confirm the markets are returning to a risk-averse stance.
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Barclays Capital