The single currency is still struggling across the broad after Trichet's signal that the ECB has disscussed 2 options cutting interest rate or keeping it. The comments have paved the way for a coming easing action in the face of the current financial market turmoil after the drop of the oil and commodities prices across the broad on the growth worries and the negative impact of the current credit crises on the growth in EU too. Technically breaking lower than the pair recent low at 1.39 is a very bearish sign underpined by inability to break above it again last friday. The next major support is at 1.336.

The Greenback is still getting support currently from the lack of liquidity and the risk aversion current stance as the first buying back currency of the global investing risks. Now and after the approving of the fixed rescue plan, the doubts about its effect are containing the current market sentiment causing further the unwinding of carry trades pushing the Japanese yen and the greenback and its treasury notes higher across the broad.

Now,The market is waiting catiously for this Friday G7 meetings.

Best wishes

FX Consultant

Walid Salah El Din

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