Euro and sterling fell after stocks ran-Feb 26.

Euro fell after stocks ran out of steam and a slew of new downgrades for Eastern European countries. German GDP Q4 was confirmed at -2.1%. EUR/JPY remained buoyant but couldn’t break 125 Yen. Looking ahead for German Unemployment for February forecast at 7.9% vs. 7.8%. German March GFK Index forecast at 2 vs. 2.2% previously. Japanese Yen continued to be very weak with the 97 level offering little resistance as the pair pushed to new 3 month highs. On the Crosses, initial buoyancy was pared back by major weakness with the GBP/JPY especially soft after failing to hold 140. Sterling fell heavily after the unrevised Q4 GDP at -1.5% sparked speculation of rate cuts and rumors swirled of fresh banking bailouts. EU representatives expressed concern of the pounds weakness especially against the Euro as created an artificial trade advantage. Looking ahead for February Nationwide House Prices with forecast at -1.3%m/m and -17% y/y.

Technical Outlook:

EURO R1: 1.2800 S1:1.2660
R2: 1.2820 S2:1.2640
Chart pattern hints sideways to bull note for the day . Trading range for the day is expected between 1.2680-1.2790 levels for the day. Currency is trading between the fast and slow moving average giving sideways direction .Momentum indicators are pointing up giving room for small upward correction.

GBP R1: 1.4640 S1: 1. 4450
R2: 1.4660 S2: 1. 4440
Chart pattern signals a bullish movement for the day. Trading range is expected between 1.4180-1.4340 levels for the day. Momentum and stochastic are seen trending up giving bullish signals but Currency is trading below the the moving average and parabolic is also giving a caution.