Into the new week and "Dollar diversification" tensions are once more building, in the wake of the Sino-US Friday news. EUR/USD has consolidated for the most part of the day with the failure to break into the 1.34's weighing on the medium-term outlook. Offers are noted into 1.3360/65 with more above 1.3375 while on the downside the 10-Day M/A line at 1.3335 propped the early pullback.
Central bank buyers are tipped into the 1.3300 level but decent bids trail to 1.3290 with stops then seen below here. Looking ahead, the 14:00 GMT release of the latest US ISM data (March) may be overlooked in favor of the Friday payroll numbers by Northern American players. However, with much of Europe out for the Easter long-weekend it will be the intraday data that generates short-run momentum for the Dollar.
On the options front, barriers are confirmed 1.3425 and 1.3450 with talk of expiry exposure at 1.3400 into the latter part of the week. Elsewhere, M&A news has centered on the talks between Pirelli and AT&T over its controlling stake in Telecom Italia.
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