Trading Setups / Chart in Focus:

EURUSD

The EURUSD found some support today down near 1.3500. However, we still strongly favor the short side here and so we will watch closely for a rotation into resistance followed by bearish price action on the intra-day or daily charts. Note the 50% retrace level falls right in between the 8 / 21 day EMAs; a good potential sell-zone to watch for price action sell signals.

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Forex Commentary:

The euro rebounded from a seven-month low against the U.S. dollar in late trade on Monday following a report that Italy has asked China to make “significant” purchases of Italian debt, but analysts said bearish momentum remained.

Fears of a Greek debt default and a possible rating downgrade of French banks, which reportedly have some of the biggest exposure to Greek debt, could keep the euro under pressure this week.

The yen surged to a 10-year peak versus the euro and rose against the dollar as investors sought safe havens, heightening the risk of intervention by Japanese authorities.

The Australian dollar, seen as a barometer of risk appetite, fell to a one-month low of US$1.0256 as investors fretted that the global economy could be dealt a blow if euro zone debt woes deepen. It last traded at US$1.0347, down 1.2 percent.

The Canadian dollar fell to the lowest level in more than seven months versus the greenback, although it recovered in the New York session. The U.S. dollar was last down 0.5 percent at C$0.9925

Other Markets:

On Wall Street today, stocks gained ground after a late-day rally spurred by hopes that Italy could get financial support from China, this worked to lower investors’ worst fears about the euro-zone’s debt problems.

The Dow added 68.99 points, or 0.63 percent, the S&P 500 gained 8.04 points, or 0.70 percent, and the Nasdaq gained 27.10 points, or 1.10 percent.

Upcoming important economic announcements: 9/13/2011

4:30am EST: Britain – CPI y/y