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24/3/2010 - The Current Market Sentiment

Discussion in 'Current Market Sentiments' started by fx-recommends, Mar 23, 2010.

  1. fx-recommends

    fx-recommends Content Contributor

    Aug 6, 2008
    Likes Received:
    As expected the pressure on the single currency has increased by the market worries about Greece debt problem and the unchanged solid germane position from giving unwarranted financial support to Greece until now. The worries about spreading the debts problems in other countries in the euro area and the downgrading of their creditability are putting pressure on the single currency across the broad with the deficit to GDP ratio average is at 6% nearly right now, while it should be below 3% on Maastricht treaty of the Euro area with no certain joint rescue plan or European mechanism for solving these financial problems out until now to store confidence on the Euro zone financial stability outlook.
    Last week, Moody's warned about the triple A crediting countries with the current slow economic recovery in Europe comparing with US and the debt which is still accumulating in other European countries like Spain and Portugal because of the credit crisis which pushed the governmental spending up and expanded the monetary conditions for spurring investment and growth which is still struggling in Europe suffering from the cost of these easing stimulating plans in their budget threating the market confidence and the recovery itself with market focusing on the consequences of the debt building in Europe and the ECB inability to take to take any tightening action keeping the interest rate at 1% for more than a year after the realized financial stability in US which supports the greenback which is looking having a brighter interest rate outlook differential now comparing with the single currency which faces new financial problems from another side and very lower rates of growth losing the investors trust in holding it versus the greenback forcing it to fall below 1.35 testing again 1.344 supporting level of its trading barrier between 1.382 and 1.344 since the beginning of last month after several failing tries to get back above 1.382 and the breaking of this lower band can exacerbate the market sentiment towards the single currency increasing the selling momentum of it which can lead to the third impulsive wave of this downtrend which has started since the beginning of last December when at 1.515 and ended its first impulsive wave at 1.422 and by god's will, it can try to reach the next psychological level at 1.30.

    Best wishes

    FX Consultant
    Walid Salah El Din
    E-Mail: mail@fx-recommends.com

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