Friday, October 19, 2012

Forex Daily Review: EUR/USD Gains on Precautionary Conditioned Credit Line (PCCL)

17 Oct 2012• Matti Williamson, FX and commodities analyst      Moody's Credits the ECB

Moody's Investors Services affirmed Spain's Baa3 credit rating with a negative outlook. Moody's confirmed Spanish sovereign losing capital market access has been materially reduced as the European Central Bank (ECB) was willing to purchase Spanish bonds to limit price volatility.

EUR/USD stretched its gains above 1.3100 as the market was expecting Moody's to downgrade the Kingdom of Spain's sovereign rating. Speculations that Spain is to request a bailout via Precautionary Conditioned Credit Line (PCCL) fuelled the rally to 1.3117 but it does appear the bulls' are losing momentum ahead of the key daily resistance at 1.3140. If the daily resistance holds we may witness the formation of a double-top reversal pattern.

EUR/USD Technical Analysis



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