The Euro and the Sterling gave up earlier gains from last week as risk aversion play weighed on the high yielders. Last week the high yielding currencies among them the Euro and the Sterling were able to recover losses and rebound against the Dollar and the Yen as better than expected job figures lifted recovery hops. Nonfarm payrolls one of the strongest indicators of Job health in the US fell by -36k jobs against an expected fall of -50k jobs. The Euro was able to rebound from the 1.34 zone to above 1.37 against the Dollar and topped around 124¥ to the Yen.
The Euro and the Sterling opened the week also on a positive note; however the fact that EU and US leaders only expressed solidarity to Greece without offering financial aid moved FX players to be cautious pushing the Sterling and Euro to give up earlier gains. The Euro slide back to the 1.36 area after hitting 1.37 at the opening session and the Sterling moved back to the 1.5$ after failing to edge above 1.52$.Investors were expecting Greece to reach some sort of resolution to its debt problem and the fact that Greece failed to do so, elevated sovereign debt fears and moved investors to a risk aversion play shifting to Yen and Dollar positions to curb risk.
Euro and Sterling in tight range:
The sterling is within a tight range a break of 1.52 could move the bullish correction to resume; a close below 1.5 would move the pair to retest the 1.47-1.48 support.
A break of the 1.38 upper range would confirm the bullish correction has resumed, while a break of the 1.34 support could lead the pair to drift further south.
