As I often mention in my notes that Euro-zone recovery is temporary, engineered, done through adjusting entries by changing accounting rules, by obtaining special parliamentary approval, by printing of notes and hence it’s all unnatural  and therefore, we are going to witness frequent occurrence of such happenings on the date of rollover/settlement.

Apparently it all looked to be smooth sail when Greece bailout deal was announced, but the fate of this will be known on March 8 the deadline date by which Greece has to announce completion of its debt swap deal with private creditors with 2/3 rd or 66.6 pct participation, anything short of that number would mean the deal has collapsed and Greece would technically be facing default.

My understanding is that European policy makers will not allow default to happen tomorrow, as the timing is not appropriate and because the price of Greece default could too high and difficult to cope for the Euro-zone economies. Institute of Int’l Finance (IIF) has already warned that the estimated damage of default in EURO could be up to equivalent of USD 1.3 Trillion. Next two-months are crucial and therefore, I will not be surprised if some sort of temporary arrangement is made or grace period is given to Greece.

Once again rumor and news pertaining to Greece will dominate the market, which could see volatility and swing in the foreign exchange market. So be prepared for the choppy trading.

 

GOLD $ 1677 =  Cautious while selling Gold todauas European development should give boost to the metal. Possible break of $ 1684 could push gold to $ 1694. Strong support around $ 1670

 

EURO @ 1.3147 = I am expecting a choppy day. Euro should find top around 1.3175-80 zones, a break of 1.31 level could see a test of 1.3075 possibly1.3030 or else 1.3220

 

GBP @ 1.5732 = Euro could drag down GBP, but 1.5680 should act as strong barrier. Possible top around 1.5780 or else 1.5650.   

 

March - 6 ChinesE SloW DowN – EurO & GoLD Mar 06

http://www.forexstreet.net/profiles/blogs/chinese-slow-down-euro-go...

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Comment by asad rizvi on March 7, 2012 at 11:23am

GOLD @ 1680.40 = After hitting the downside target of $ 1670the expected up move did occur. However, we may see another dip before surpassing $ 1684 for days high……More Later

Comment by asad rizvi on March 7, 2012 at 6:34pm

GOLD $ 1684.20 = As per my call this is the 3rd perfect move of the day. After dropping to $ 1673.50, gold made a nice up move to surpass $ 1684. My target $ 1694 is intact….More Later

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