Currency Updates:
U.S. Dollar Trading (USD) the markets were selling for most of Thursday on fears nothing would come from the EU summit but this changed dramatically in Asian trade on Friday as the EU came to the rescue of European banks via using the rescue funds set up to bailout countries to directly bailout the banks as well. The EUR/USD has surged from 1.2450 to 1.2600 and is still holding near highs as traders digest the news.
The Eurozone has decided to not only allow the rescue funds to recapitalize the Eurozone banks but all banks will be treated equally and there would be new banking supervision. The EUR/USD market is extremely short so this large move could catch the market wrong footed and a short squeeze up towards 1.2700 is very possible.
