Euro/Dollar year-to-date lows – Spanish bonds all-time highs
This past week has seen a number of financially important events; from Greek election results to Spanish bonds surpassing all-time highs. Any signals of enthusiasm regarding Greece’s elections quickly faded and the overall value of the Euro has continued on a downward trend. The forex bears still seem firmly in place in both European and international market trading.
While the immediate threat of an imminent Greek default being averted initially caused a slight rally in European markets, a broader analysis revealed investors’ sentiment still remains shaky; many questioning whether Greece can adhere to the austerity guidelines previously set forth. Additionally, sharp sell-offs in Spanish and Italian bonds underpin the fact that long-term concern over the European Union’s stability continue to weigh heavily in both equity and forex markets.
Online forex traders should be cognizant of continued volatility ahead due to this prolonged instability as well as the danger of Spanish bonds remaining at unsustainable highs of at or near 7 percent. As evidence of this, the Euro/Dollar has fallen to fresh year-to-date lows, paralleling a continued deterioration in European market sentiment. It is likely that we will also see a great deal of online currency trades as investors focus on short-term profit as opposed to long-term holds.