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Euro slumps, but off lows following Cypress bank levy Morning Report: 08.30 London
• The euro dropped like a stone at the start of the Asian session on news that Cypress is to levy a deposit fee to help fund a bailout of its banks. The news has not gone down well with markets with the euro and stock markets gapping down by around 1% this morning. Analyst’s reactions have been mixed with some warning of dire political consequences of the deal (The levy applies to small and large depositors), while others are confident that this is not another Lehman month. • So far market reaction appears to be leaning towards the less w orrying interpretation of events, with the euro down, but well above the morning’s opening lows and climbing. The EUR/JPY is seeing the biggest move as the yen pairs generally drop on a risk off move by traders.
• There is very little economic data of note today. Most of today’s movement will no doubt come in reaction to the weekend’s Cypress development.
Bet Idea:
• The long term implications of the Cypress bank levy are unclear and there could be many unforeseen consequences coming from this. That said, market reaction so far has been to unwind the initial sell off, which could provide some short term trading ideas.
• Gaps tend to be filled fairly quickly and today could be such an occasion. What happens after that is anyone’s guess. A ONE TOUCH trade predicting that the EUR/JPY reach Friday’s low by the close tomorrow night could be the best play for this.
Euro slumps, but off lows following Cypress bank levy
Morning Report: 08.30 London
• The euro dropped like a stone at the start of the Asian session on news that Cypress is to levy a deposit fee to help fund a bailout of its banks. The news has not gone down well with markets with the euro and stock markets gapping down by around 1% this morning. Analyst’s reactions have been mixed with some warning of dire political consequences of the deal (The levy applies to small and large depositors), while others are confident that this is not another Lehman month.
• So far market reaction appears to be leaning towards the less w
orrying interpretation of events, with the euro down, but well above the morning’s opening lows and climbing. The EUR/JPY is seeing the biggest move as the yen pairs generally drop on a risk off move by traders.
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• The US dollar is down by around 0.56% against the yen.
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• The pound is holding up relatively well this morning, with the
EUR/GBP up around 1% and the GBP/USD is barely changed si
nce Friday’s close.
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• Gold gapped higher at the open and has so far been volatile with a downside bias.
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Coming up today:
• There is very little economic data of note today. Most of today’s movement will no doubt come in reaction to the weekend’s Cypress development.
Bet Idea:
• The long term implications of the Cypress bank levy are unclear and there could be many unforeseen consequences coming from this. That said, market reaction so far has been to unwind the initial sell off, which could provide some short term trading ideas.
Click here to view full-sized image
• Gaps tend to be filled fairly quickly and today could be such an occasion. What happens after that is anyone’s guess. A ONE TOUCH trade predicting that the EUR/JPY reach Friday’s low by the close tomorrow night could be the best play for this.
A ONE TOUCH trade predicting that the EUR/JPY TOUCHES 124.00 in the next 1 day could return 124% if successful.
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This is presented as an idea to stimulate fixed odds financial betting ideas and is not financial advice.
Summary:
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