Closed in NY Friday at $1.3076 after recovering off a US session corrective pullback low of $1.3046. The decision to penalise Cypriot bank depositors, as part of the Troika bail-out terms for Cyprus, prompted negative news reports on the euro, and the knock on effects this decision would have, leaving markets to mark down euro-dollar into opening trade Monday. Rate opened at $1.2955 and was promptly pressed to early lows of $1.2905., the move taking out barrier interest at $1.2920 but the larger one at $1.2900 drew stronger defence. A brief recovery to $1.2930 allowed for fresh selling that took rate to an eventual overnight low of $1.2882, just shy of its 200-dma at $1.2873, recovering to $1.2905 into Europe. The NY close/Asia open leaves a 120 point gap to fill which tech traders will focus on. Markets Monday will try and assess if the events in Cyprus will be a contained event and the effects on the euro. Bids remain in place between $1.2885/75, the area covering the 200-dma as well as Dec7 lows at $1.2877. Resistance seen at $1.2920/30, a break to open a move toward the opening area at $1.2955/60.
EasyForexNews Research Team