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European session FX preopen

By Francisco Miñana

Date: Monday 18 Jun 2012

This is a FOREX market update at the european session preopen.

Main headlines:

Euro Gains as Greeks Back Pro-Bailout Parties.-Bloomberg

Pro-Bailout Parties to Forge Coalition.-CNBC

Euro, shares jump as Greece avoids "Drachmageddon".-Reuters

America’s wrap up:

Fed-Not Greece-could Boost the Euro This Week.-CNBC

Dollar Shortage Seen in $2 Trillion Mismatch Uncovered by Morgan Stanley.-Bloomberg

Asia’s wrap up:

Asia Stocks, Euro Gain on Greek Pro-Bailout Vote.-Bloomberg

India Stuns Markets By Holding, Not Cutting, Rates.-CNBC

Nuclear-Restart Plans Divide Japan.-WSJ

HKEx's Purchase of LME May Clear Regulator.-Bloomberg

China’s Economy Will Bottom Out This Quarter.-Bloomberg

Mining boom is creating a two-speed Australia.-FT

China Home Prices Fall in Record No. of Cities.-Bloomberg

European preview:

G20 to press Europe for lasting fix for debt crisis.-Reuters

French Socialists Win Absolute Majority.-Bloomberg

Denmark warns over pressure on krone.-FT

Real Question for Greece Is What Now, Says Wilbur Ross.-CNBC

FOREX action

EUR: The euro crosses have opened another week in Asia with a bullish gap. This time Greek election results with a pro-euro outcome gave a boost to European assets. For the time being there is no need for coordinated action from central banks on a global scale. The EUR-USD is moving above the 1.2650 resistance level at 1.2700 and the EUR-JPY has again breached the 100 psychological area.

GBP: Sterling crosses are moving in synch with the euro. Cable has broken the recent range and is moving close to 1.57. We can see bullish gaps in this pair as well as in the GBP-JPY and the EUR-GBP, with the latter moving close to but below 0.8100.

CHF: After the relief in Greece the Swiss franc is giving up some of its recent gains due to demand for safe-haven assets. The EUR-CHF is moving closer to the 1.20 threshold. The USD-CHF is moving close to 0.9450.

Nordics: The SEK and the NOK are losing ground against the EUR and advancing versus the USD. Safe-haven demand linked to peripheral woes has pushed them up recently.

USD: After the Greek elections and the Eurogroup meeting the US economy is going to be closely monitored due to the upcoming FOMC. Poor industrial production numbers on Friday show a worsening bias in the US economic indicators. The USD-JPY has opened the week with a half figure gap and is moving above 79.00.

CAD, AUD & NZD: The three other dollar crosses are showing strength against the greenback and the yen, thanks to reduced risk aversion after Greek elections results. The AUD-USD moves well above the parity zone and the USD-CAD is still stuck at the 1.02 support area.

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