With precious little fundamental news on the economic calendar today for Europe and none at all for the US markets are taking a breather and waiting to decide whether last week’s favourable NFP data is really the start of a long, slow recovery back to economic health.  The only items of news in Europe have been French Industrial Production which came in better than expected along with the Sentix Investor Confidence number which too came in better than expected at -17 against a forecast of -26.   As always the markets have to decide between risk appetite or risk avoidance and market mood can often be found in correlated or related markets.  For this week it will be whether the 10 yr bond yield continues to rise and test the 4% level, last seen in early June, as investors take their money into riskier assets.   On such decisions will also rest the fate of the US Dollar which did not weaken last Friday on rising equities as the market perhaps starts to take the view that with the US inching back into growth the FED will need to start thinking about interest rates once again.  This week’s FED meeting and raft of data from China should provide the forex market with plenty to think about.

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