European stock markets open with gains; Euro and Pound continue recovery

European markets have opened Tuesday’s sessions with gains reversing partially declines posted on Monday; Euro and Pound remain trading higher after having bottomed yesterday.European markets are posting gains around 1.0% on Tuesday following news by Mark & Spencer, UK’s biggest retailer, obtaining better than expected results. Eurostoxx 50 adds 1.04% and German DAX Index is up 1.02%, with French CAC Index 1.12% up after 1 hour of trading.On the macroeconomic front German Unemployment has increased at a larger than expected extent in February.

German adjusted unemployment rate reached 8.1% in Feb from 8.0% in Jan.Euro and Pound at resistance levelsEuro and Pound are struggling with potential key levels at the minute. EUR/USD rally from 1.3110 low on Monday has reached resistance zone at 1.3275/85 level, which is being tested right now.GBP/USD has suffered a slight reversal at 1.4340; the level has been tested twice, and the Pound has been rejected so far. GBP/USD is trading above the 50 day SMA, although rally from 1.4110 low yesterday seems to be losing strength.USD/JPY rally from 95.95 low yesterday has reached 98.35/45 resistance level (Mar 29 High) although the Dollar has not been strong enough to break it yet.

EUR/USD: The Euro breaks support at 1.2700; 1.2550 next

The Euro has dropped dramatically in Tuesday’s Asian session breaking support at 1.2720/1.2700 to levels about 1.2620, the lowest since early December. Concerns about Eastern European economies and their Banking system affecting European Union have weighted heavily upon the Euro.The Euro has lost about 200 pips during the Asian session from above 1.2800 falling to 1.2622, in the cross looks bearish on the hourly chart and next important support levels could be tested at 1.2550 and 1.2424. Resistance around 1.2700/1.2730 next resistance area at 1.2800 and above there 1.2850.EUR/JPY has also dropped heavily on Asian session, rejected by the 117.30 resistance line, EUR/JPY has dropped to 116.70 so far and looks on its way to test support at 116.50.