Even though EU chiefs came to an agreement to draft a new treaty for deeper economic integration, investors think that USD is strong as it is the only viable safe-haven currency at the moment. The summit of European leaders last week did not bring any extra-ordinary solutions to the current financial crisis.

Chief Forex strategist at Barclays, Masafumi Yamamoto said:

“There was some progress made in Europe, such as having an accord on funding, which helps negative sentiment to recede and risk-on mood to return. The fact that the IMF was involved and China was reportedly planning to invest in Europe shouldn’t be overlooked either, as having global lenders interested in Europe was also a focal point in gauging the progress in the debt crisis”.

Investors think that the eurozone’s safety is still fragile, and the latest agreement to limit future budget deficits and public debt is not sufficient to prevent a sovereign debt crisis from spreading.

For now, the markets are calm and the market participants’ focus is on bond sales by both Spain and Italy. Of course, investors are awaiting the Federal Open Market Committee statement as well before making their decisions.

Today we see that the Asian stock markets opened higher as the market participants are awaiting the Federal Open Market Committee meeting tomorrow. Investors expect to see further signs of economic recovery in the United States.

NIKKEI started the day at 8,652.98, previous close was 8,536.46. HANG SENG opened at 18,875.86, previous close was 18,586.23.

Assistant manager at Okasan Securities, Hideyuki Ishiguro said: “The fact that leaders came to an agreement on the fiscal pact shows markets that they are moving in the right direction, although it is not a measure that provides immediate relief”.

EUR/USD is trading at 1.3352 by the time of typing and for today resistances are located at 1.3440 and 1.3512. Support levels are 1.3288 and 1.3208.

GBP/USD is at 1.5636. Resistance levels are located at 1.5730 and 1.5809. Supports are located at 1.5585 and 1.5515.

USD/CHF is trading at 0.9262 by the time of typing and for today resistances are located at 0.9292 and 0.9338. Support levels are 0.9236 and 0.9165.

AUD/USD is trading at 1.0174. Resistances are located at 1.0270 and 1.0336. Support levels are 1.0160 and 1.0098.

The economic calendar is not heavy today. Japan Prelim Machine Tool Orders figures will be released at 06:00 GMT.

German Wholesale Price Index data will be released at 07:00 GMT. Swiss Employment Level data is due at 08:15 GMT.

Bank of Canada Governor Mark Carney is due to hold a press conference at 18:10 GMT. U.S.

Federal Budget Balance report will be released at 19:00 GMT. Japan Tertiary Industry Activity figures will be released at 23:30 GMT.