EUR/USD Gaines further on Spain’s Credit Ranking
October 17, 2012 12:43 am GMT+0 in Forex Analysis
EUR/USD moved further up and went as high as 1.3124 after Moody’s kept the credit ranking of Spain on Investment grade which boosted the confidence in Spain. Euro needs every bit of support to keep the negative pressures off and they way it happens is that at such times every bit works more than it would at the normal times.
What Else is in Euro’s Favor?
Of course Spain maintaining it’s Investment grade ranking rises the market sentiments for Euro zone and Euro but some of the other direct or indirect factors are as follows:
1) Moody’s downgrading the outlook of Citigroup after Vikram Pandit’s resignation
Moody’s Investor Service has cut the credit rating outlook of Citi to “Negative” considering the risk factors because of sudden change in the management because of Vikram Pandit’s sudden resignation along with John P. Havens (President and COO).
2) U.S. Elections
Elections with the possibilities of some major change always brings an amount of uncertainty in the market. The tight race between Barack Obama and Republican Mitt Romney is no exception. Today is the second debate between the candidates with tight competition before the final debate of October 22nd.
EUR/USD: What to Expect:
Further strength is expected but for that EUR/USD has to break over the critical 1.3172 resistance. Such a break should target 1.3280 first and with any decisive break of 1.3283, The currency pair may aim for 1.3380 or more.
However a failure at 1.3172 should bring downward consolidation 1.3020 or more.
Other Currency Pairs to Watch:
AUD/USD: A jump came with the positive sentiments from Euro zone about Spain. SOme more strength is expected towards 1.0360 but overall outlook is for another fall. Tomorrow’s GDP numbers from China may bring some bigger moves.
USD/CHF: The break below the low of 0.9238 confirmed the continuing bearish outlook. Further deeper moves towards 0.9140/0.9160 support zone can be expected.