Euro hits 4-month low vs dollar
Singapore, January 10, 2011
The euro touched four-month lows against the dollar on Monday after stops were triggered in thin trade against the backdrop of mounting worries about Europe's debt crisis.
The single currency fell to lows not seen since mid-September, slipping as deep as $1.2860 on trading platform EBS, after stops around $1.2900 and $1.2870 were triggered.
Although the euro later pared its losses on short-covering, market players said the single European currency still looked vulnerable, due to worries about the level of demand at euro zone debt auctions coming up this week.
"I think overall the path of least resistance is going to be the downside for the euro," said Andrew Robinson, currency market strategist for Saxo Capital Markets in Singapore.
Since the euro breached its 200-day moving average last week, the next downside target may be the 61.8 percent retracement of its rally between June to November of 2010 that comes in right below $1.2800, Robinson said.
The euro last stood at $1.2915, up 0.1 percent from late U.S. trading on Friday.
The common currency had already been under pressure last week, falling from a peak of $1.3435 on Jan. 4, as investors sold peripheral euro zone bonds ahead of new debt supply from the likes of Portugal and Spain this week. - Reuters