Today, in the absence of data or policy catalysts, the Euro remains steady with Spanish yield continuing to dip on expectation of ECB actions in September. Recent comments from European Union leaders sustained hopes for progress in the region’s debt crisis. In a few weeks, the troika (European Commission, the European Central Bank and the International Monetary Fund) officials are traveling to Greece to check on the progress that the country has made with its austerity program.
Greek Prime Minister Antonis Samaras will meet German Chancellor Angela Merkel this week. One thing is clear: In addition to more time, Greece also needs more money. The Greek prime minister is expected to ask Angela Merkel for his country to be given two more years to adhere to the austerity conditions attached to the country’s EU-IMF bailout program. However, any decisions will have to wait until after a report from the troika is released in October.
The Asian stock markets opened higher today as Friday’s survey showed U.S. consumer sentiment improved in early August to its highest in three months and foreign investors appeared to return to the market as net buyers last week. NIKKEI started the day at 9,202.36, previous close was 9,165.50. HANG SENG opened at 20,080.30, previous close was 20,116.10.
CFTC’s data, which was released on Friday, showed that speculative traders on the Chicago Mercantile Exchange increased their open short EUR position by 4% from a week earlier to reach a net of $21.2 billion, while decreasing their bets on the dollar rise by 26% to reach a net of $7.7 billion.
Speculative traders increased their open short CHF position by 5% from a week earlier to reach a net of $2.4 billion. They also increased their open long JPY position by 11% to reach a net of $4.9 billion, according to the Commodity Futures Trading Commission’s weekly report on the commitments of traders.
EUR/USD is trading at 1.2329 by the time of typing and for today resistances are located at 1.2355 and 1.2400. Support levels are 1.2316 and 1.2280.
GBP/USD is at 1.5690. Resistance levels are located at 1.5730 and 1.5770. Supports are located at 1.5649 and 1.5598.
USD/CHF is trading at 0.9738 by the time of typing and for today resistances are located at 0.9766 and 0.9785. Support levels are 0.9702 and 0.9667.
AUD/USD is trading at 1.0444. Resistances are located at 1.0465 and 1.0500. Support levels are 1.0404 and 1.0352.
The economic calendar is empty today. Investors will be waiting for the U.S. housing data and several PMIs from the eurozone later this week. The minutes of the latest Federal Reserve policy committee meeting, due Wednesday, could be the week’s highlight in terms of calendar events.