This is the question as we lead up to the ECB meeting later this week. Today’s CPI data suggests that the Eurozone’s largest economy (and most important central bank), Germany, should support cutting interest rates as a deflationary impulse appears to have taken hold. The annual inflation rate for Germany fell to a mere 1.1%, down from 1.8% in March. This is well below the ECB’s forecast for inflation this year and also well below its target rate of 2% or just below. The risk is that inflation could have further to fall, especially if we witness more declines in commodity prices in the weeks and months ahead.

Data/Event Risks

USD: Today’s data will be of only minor interest for the dollar. The income and spending numbers at 12:30 have been superseded by the GDP numbers on Friday and the pending home sales is never a big issue for market unless it’s drastically away from expectations.

EUR: The single currency will have one eye on the Italian and Eurozone confidence data released this morning, especially in light of the weaker confidence data seen from Germany recently. Softer data would further increase speculation of a lowering of interest rates from the ECB this week.

International Gold is staying at $1471, and not showing much movement in intraday basis. There is not much important data for Commodities market today. Previous trading session's high will perform as major resistance. Price line volatile today.

The currency instruments have not moved in very significant modes this week, but some serious movements are expected today. This could favor the bears in certain cases.  

EURUSD: This pair - which ranged largely last week – has begun some upward movement this week (with some amount of limitation). The limitation can only be overridden when the price breaks the resistance level at 1.3100 to the upside, closed above it, and trended further northward. The ultimate target for this week is around the resistance line of 1.3200.

Last week, the JPY pairs made weak bullish attempts before the bears started to dominate. There are signs that the pairs may be moving downwards this week.

EURUSD: This pair moved in a tight range throughout last week, without showing any significant move either in favor of the bear or the bull. It’s however, possible that the breakout away from the current equilibrium zone might be in favor of the bears. Because of this outlook, the bearish bias is assumed for now.    

TRADING COMMODITY FUTURES AND OPTIONS INVOLVES SUBSTANTIAL RISK OF LOSS AND MAY NOT BE SUITABLE FOR ALL INVESTORS. YOU SHOULD CAREFULLY CONSIDER WHETHER TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR CIRCUMSTANCES, KNOWLEDGE AND FINANCIAL RESOURCES.

GRAIN TECHNICALS: CORN, SOYBEANS, WHEAT, AND WEATHER

This Grains article will focus on then Grain Technicals and Weather

MY TECHNICAL C0MMENTARY

DAX has shown a good buying opportunity before few days and given a good return on long positions. But this time, index should face some correction or likely to come down from this level. Day traders can make short position with the stop loss of 7860 level for a lower target of 7735. Let us we check it...