By FXEmpire.com

Analysis and Recommendations:

The EUR/USD is surprisingly strong in late afternoon trading, exchanging at 1.3060 as markets were looking at the possibility of the euro falling below the 1.30 price. It is inevitable, but at least for today, the euro survived. In Europe, political uncertainty in respect with the elections in France and Greece is exerting lower pressure on the complete commodity complex. In France, President Nicolas Sarkozy has lost 2011 Presidential elections to Socialist challenger Francois Hollande, who is against the stringent austerity measures and wants to renegotiate Europe’s fiscal and budget rules.

In Greece, exit polls indicate that the center right New Democracy Party and the center-left Pasok party, both supporters of the country’s most recent bailout are poised to face a defeat in the elections.

This week is surprising thin in eco data, which means the news services will be longing for news which makes it prime for rumor and innuendo, so expect to see Spain splashed back on the front page along with dramas between the old EU regime and the new.

On the US side, again there is little news this week, except the drop in crude prices, should help spur the recovery and possibly pull it through the spring stall.

With crude falling so will the price at the pumps, which will increase consumer sentiment and help reduce manufacturing costs and transportation, which will help create jobs.

Perhaps we have the beginning of a new cycle, and Mr. Obama needs the economy to start to bubble otherwise he will be spending vacations visiting Mr Sarkozy.

Economic Releases May 7, 2012 actual v. forecast

AUD

Building Approvals (MoM)

7.4%

3.1%

-8.8%

AUD

NAB Business Confidence

4

3

AUD

Retail Sales (MoM)

0.9%

0.2%

0.3%

CHF

Unemployment Rate

3.1%

3.1%

3.0%

CHF

CPI (MoM)

0.1%

0.2%

0.6%

EUR

German Factory Orders (MoM)

2.2%

0.5%

0.6%

CAD

Building Permits (MoM)

4.7%

-1.5%

7.6%

Economic Events for May 8, 2012

00:01 GBP RICS House Price Balance -10% -10%

02:30 AUD Trade Balance -1.40B -0.48B

06:45 CHF GDP 0.1%

06:45 CHF SECO Consumer Climate -18 -19

13:15 CAD Housing Starts 202K 216K

Government Bond Auctions (this week)

Date Time Country

May 08 09:15 Austria

May 08 09:30 Belgium

May 08 14:30 UK

May 08 15:30 Italy

May 08 17:00 US

May 09 09:10 Sweden

May 09 09:30 Germany

May 09 09:30 Swiss

May 09 09:30 UK

May 09 14:30 Sweden

May 09 15:30 Italy

May 09 17:00 US

May 10 15:00 US

May 10 17:00 US

May 11 09:10 Italy BOT auction

May 11 10:00 Belgium

Click here to read EUR/USD Technical Analysis.

Originally posted here