Euro held to a tight range but sterling lostagainst dollar-Mar 03.

Euro held to a tight range but was under pressure as risk aversion pushed the pair below 1.26. The lack of heavy EUR/JPY sales kept Euro losses to minimum. News over the weekend that the EU had rejected initial plans for a 180 billion bailout package for Eastern Europe did little to help sentiment. February Euro zone PMI Manufacturing was confirmed at 33.5 vs. 34.4 previously. Looking ahead for German January WPI forecast at -2% vs. -3% previously .Sterling lost a lot of the support that had formed in previous weeks as HSBC reported a 17 Billion loss and initiated a capital raising effort. Mortgage data was extremely weak with January lending falling to 0.69Bn vs. 1.794Bn previously. Market attention now turns to BOE meeting on Thursday.

Technical Outlook:

EURO R1: 1.2690 S1:1.2500
R2: 1.2700 S2:1.2470
Chart pattern shows the formation of triangle only break on either sides can confirm the trend. . Trading range for the day is expected between 1.2520-1.2680 levels for the day. Currency is trading below the moving averages. Stochastic and momentum are pointing up.

GBP R1: 1.4360 S1: 1. 4150
R2: 1.4380 S2: 1. 4140
Chart pattern signals a bullish momentum for the day. Trading range is expected between 1.3950-1.4150 levels for the day. Stochastic has turned from the oversold area and is seen trending up giving bullish signals but Currency is trading below the the moving average and parabolic is indicating bear note in near term .