As we have mentioned in the beginning hours of the week, the single currency was under technical pressure after the breaking of 1.341 and the trend line resistance which is extended from 1.2616 to 1.2986 at 1.3463 and it has found the support just above 1.31. The single currency faced resistance yesterday after this bottoming out at 1.3345 because of the weak flash release of the EU HICP of March which has come at just .6% y/y and the market was waiting for .9% this tame inflation pressure can encourage the ECB to cut the interest rate further to stimulate the struggling growth and push the banks to lend again.

We wait later this week for the ECB interest rate decision which is widely expected to be a cut by .5% to be just 1% and the press conference of the ECB president following this decision.

The single currency was under a technical pressure after breaking 1.341 versus the greenback the pair is trading currently at 1.325. the greenback has been boosted by the decline in the equity market by the weekend which can continue with the opening of the US stock market after 3 weeks of gains spurred by the market optimism of the recent stimulations plans which are expected to continue and the market is waiting this week for further stimulation plans for the car markers in US which can help the equity market to keep its recent gains. The market has bought these plans and believed in its effects on the financial market and after this recent rally in the US equity market there can be a believe that the worst of the equity market because of the credit crisis is behind and the bottom has been formed at this month low on the 9th of this month when the Dow reached 6500.

Today's Geithner talking about his readiness to use the SDRs system could put more weights on the greenback. This announcement came after the Chinese criticism of the current system which is based widely on the US dollar which can be impacted by the US interior factors. If the market put this insight with the current quantitive easing policy and the recession pressure in US which is resulted from the collapse of the housing market in US and the credit crisis that followed this collapse, the greenback can be under potential pressure can undermine it and reverse its recent uptrend and increase the demand for the gold as a fixed store of the countries reserve which rose.

The market optimism because of the Treasury new plans for buying more toxic assets to spur investing and borrowing again could contain the current market sentiment with the beginning of this week. The equities markets have opened higher waiting for today's Geithner details of the new plan and from another side, the US Feb home sales came surprisingly up by 5.1% and the market was expecting a decline by 5.3% adding to the stock market gains. The home sales of been 4.72m and it was 4.49m in Jan and the market was waiting this number to decline to 4.45m.