What the heck is happening on EUR/USD! For the fourth day in a row, the pair formed a spinning top-like candlestick on the daily chart, as it finished just a few pips below its opening price. Will we finally see a breakout to end the week?
The euro dropped late in the London session, as Spanish yields once again took the spotlight. Apparently, Spanish yields are slowly creeping back up to 7%, as European leaders will be meeting today to discuss the conditions for a Spanish bailout.
Yes, a bailout is coming, but of course, nothing comes that easy! There are some questions as to whether or not the moolah will flow directly to Spanish banks, or if it will still go the government. There’s also a question of whether senior bondholders will have to take losses on the debt that they are already holding.
In other news, the current account printed a surplus of 10.9 billion EUR, which was more than double than the expected 5.3 billion EUR figure.
For today, the only hard report headed our way is the German producer prince index report at 6:00 am GMT. Word on the street is that the producers paid 0.2% less for their raw materials last month.
However, I don’t expect market players to pay much attention to this report, as they’ll most likely be gearing themselves up for the Eurogroup meetings that will take place.
Will Spain be granted lax bailout terms or will Germany lay down the law? Woooo! What a way to end the week homies!