FOREXYARD: Forex News Blog

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EUR Sinks Following German Bund Auction Posted: 23 Nov 2011 06:32 AM PST The EUR was sent to a 6-week low versus the USD after multiple bearish events came one after another. The final straw was a weak bond auction by Germany. After being sent lower overnight following a poor Chinese PMI survey and reports the Dexia bailout will need to be restructured the selling of the EUR increased. Disappointing European PMI surveys point to a contraction in European GDP. Both the manufacturing survey and services surveys came in below the 50 boom/bust level. Industrial new orders for the month of October collapsed by -6.4%, more than twice the drop the market was expecting. The final straw came when Germany failed to auction all EUR 6 bn of 10-year bunds. The auction only drew EUR 3.44 bn with a yield of 1.98%. A weak bond auction from Germany highlights the transition of the European debt crisis from the periphery to the north as ultra-safe German bonds are now being influenced by the market stress. The EUR came under pressure following the auction with the EUR/USD trading as low as 1.3370. Support is located at the October low of 1.3145. Initial resistance is found at 1.3480 followed by the November 18th high of 1.3610. Read more forex trading news on our forex blog.

Economic Calendar Packed with Data Posted: 23 Nov 2011 12:23 AM PST Today will have a significant amount of data on the economic calendar. European PMI data will likely show the euro zone slipping towards a recession. The BoE meeting minutes could hint at additional easing of UK monetary policy. EU industrial data is expected to drop and will cap out the morning which is coming off of a volatile Asian trading session. US data later today will have weekly unemployment claims and durable goods orders before the Thanksgiving holiday. Earlier today the release of a surprise drop in the Chinese manufacturing PMI had risky assets trading sharply lower with the EUR/USD trading as low as 1.3440 and the AUD/USD down to 0.9760. A break of 1.3440 may open the door to the September low of 1.3360 and 0.9700 from the March low. With increasing tensions in Europe and liquidity expected to fall off due to the holiday, volatility could begin to pick up in the FX markets. This could bring oversized moves in the markets, pushing the current trends even further. Read more forex trading news on our forex blog.

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