Good Morning Traders
Yesterday saw the last day of February and trading conditions were quite choppy as was expected with some month end positioning towards the end of the US session. The Eur came under pressure throughout the European session as continued worries about the Italian remain as the dominating factor throughout Europe  We also saw the ECB Vice President Vitor Constancio state that the EU must plan for bank failures, this also added to existing worries about the eurozone and we saw the Euro lose recent gains against some of the major currency pairs. From a technical perspective the Euro looks to be supported between 1.30 on the downside with bids seen below this level and 1.32 on the upside with orders seen above this figure.
This morning we have a heavy news flow out the Eurozone with Euro-area PMI's at(9am) which may confirm the pace of contraction picked up in February even as output grew in Germany (8.55am). The ECB will then announce its LTRO repayment at 11am.
Across the pond it is the day we have seen the continued move to the upside throughout the early trading session, the US equity markets continue their move higher and it has been like this for the past few weeks, with the exception of the Italian election turmoil. However the sharp sell-off into the US close last night was an interesting move and one that has to be analysed by traders, was it simply month end positioning? Profit taking for February month end, with some large institutions taking money off the table? Or was it worries concerning the spending cuts that are due to set in tomorrow?. All talk and focus from the US today will be over the 'Sequester' and whether the democrats and Republicans can iron out a deal before the deadline is reached. In my opinion some deal will be reached, it may be another 'kicking the can down the road exercise' but expect to see US markets react aggressively to whatever news is released.
In summary it is due to be an extremely volatile trading day due to the number of important data set to be released from the EU and the US, be sure to keep and eye on the economic calender and try to use the news to your advantage, wait from breakouts of levels and trade the trend, try not to get caught up trading within the range its too dangerous.
Happy Trading
@lowkeycapital