EURO Aftermath!

EURGBP as of June 29, 2012

Indeed, the EU summit turned out to be favorable for the EURUSD and have spilled over to the EURGBP cross rate which we have speculated would likewise move contrary from the past few days.

The positive results with the EU leaders to boost banks from the funds and concentrate on growth as their main agenda have provide the extra confidence in the market place. Thus, triggering a rally for the EURUSD at the current price of 1.2638 and 0.8077 respectively for the EURGBP cross rate. The earlier postion on the EURGBP ( shown below) as of June 28 have resulted to a floating gain overall. As the market place before the news came was so negative not only in market sentiments but volumes, open interest and prices were so low that it signified a possible turn contrary to it previous trend. This is the kind of market behavior that persist and are susceptible for a spook in the market place before and after a major event. However, the USDx have opened with a daily gap lower and still heading lower at the early trading signaling a price reversal and major correction from its previous closing. Follow through short-covering at the closing month's trade is actually happening triggering a mass rapid price movement.