The main attention over the past few weeks has been on the US economy and dollar. There has been a tentative shift in sentiment over the past few days and there is a strong probability that the Euro-zone will be in greater focus over the next few weeks. The structural weaknesses are still very important and the bad-debt situation in the banks has not been dealt with during 2009. Credit conditions are also liable to deteriorate. Option expiry is liable to trigger further volatility in the very short term with immediate Euro support at 1.48, but the net risks suggest that the Euro will weaken to 1.4650 against the dollar next week. The Euro weakened to lows around 1.4840 against the dollar...
