Market Overview

European Morning Wrap: Busy Enough, but We Haven't Really Gone Anywhere

Spain's Rajoy: 'Today we don't need' ECB bond buying mechanism.  Will use ECB bond buying only if necessary
German December manufacturing PMI 46.3, weaker than Reuters' median forecast of 47.2.  On the flip side, services PMI 52.1, stronger than Reuters' median forecast of 50.0
Euro zone December composite PMI 47.3, stronger than Reuters' median forecast of 46.8, a nine-month  high
Reuters poll: 14 out of 19 economists expect BOJ to ease monetary policy at Dec 19-20 meeting
Fitch affirms France at 'AAA'; outlook negative
French FinMin Moscovici: Euro crisis in the process of being resolved

Bit of activity this morning,  but not a heck of a lot of change.

EUR/USD down marginally at 1.3075 from early 1.3095.  We rallied intially managing to finally take out stubborn resistance at 1.3100.  Reports had the next cluster of sell orders lined up at 1.3120/30 and we topped out at 1.3120 exactly. It was all downhill from there, the release of weaker than expected German manufacturing PMI accelerating the sell-off despite better than expected German services PMI.  Only yesterday Merkel said Europe cannot live alone from services sector, needs industrial production.  Guess market hadn't forgotten.

Talk of buy stops through both 1.3125 and 1,3130.  What's 5 pips between friends.  Personally I'd go with the latter level.  Downside, talk of buy  orders clustered 1.3060 through to 1,3040.  Probably sell stops close below there, but haven't got any definitive level/s.

USD/JPY at 83.75, marginally lower from early 83.87.  84.00  barrier option defence evident.  EUR/JPY down at 109.50 from early 109.90, 110.00 barrier option defence also evident.

Cable up about 10 pips at 1.6135.

The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

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