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31 Aug 2015
EUR/USD: Risk aversion allows 1.12 be re-taken
FXStreet (Bali) - EUR/USD has broken above the 1.12 handle following an early risk-averse stance in Asia, with the S&P 500 futures down more than 1%.
China behind S&P500 futures selling?
One of the headlines attributed to have acted as the catalyst is a FT front page reporting that "China's government has decided to abandon attempts to boost the stock market through large-scale share purchases."
In times of risk-aversion, the Euro, as the favoured funding currency, tends to appreciate in what seems to be a new paradigm unfolding in the markets, and likely to remain so as long as the ECB is engaged in QE practices.
EUR/USD technicals
Technically, the EUR/USD has now found a solid floor just ahead of 1.1150, with sellers having failed to break it after no less than 3 attempts since last Friday, before the risk aversion-led spike through 1.12. On the upside, should risk-off conditions stay, 1.1230 looks like the next area where offers might be stacked - intraday level - ahead of 1.1250 - high volume node Friday - ahead of 1.1270/75 - intraday-.
China behind S&P500 futures selling?
One of the headlines attributed to have acted as the catalyst is a FT front page reporting that "China's government has decided to abandon attempts to boost the stock market through large-scale share purchases."
In times of risk-aversion, the Euro, as the favoured funding currency, tends to appreciate in what seems to be a new paradigm unfolding in the markets, and likely to remain so as long as the ECB is engaged in QE practices.
EUR/USD technicals
Technically, the EUR/USD has now found a solid floor just ahead of 1.1150, with sellers having failed to break it after no less than 3 attempts since last Friday, before the risk aversion-led spike through 1.12. On the upside, should risk-off conditions stay, 1.1230 looks like the next area where offers might be stacked - intraday level - ahead of 1.1250 - high volume node Friday - ahead of 1.1270/75 - intraday-.