European banks to increase reserves

Market Leader informed

Over the near term the European Commission will look into the proposal made by the Basel Committee on Banking Supervision to reconsider the rates of reserve accumulation during economic uprising in favor of increasing them.

Such a measure is aimed at restraining the excessive volume of bank lending, which leads to a financial crisis. Besides, more solid bank reserves will soften the losses of the financial institutions under recession.

These proposals of the committee have been the toughest ones over the whole period of the common banking regulation in Europe since 1974. In their turn, the representatives of the European Banking Federation suppose that such an increase in the rates of reserve accumulation will deteriorate the situation in the banking sector.

Yesterday during the news release on the Fed Reserve interest rate decision, which remained intact at 0.25%, the European currency updated its mid-term high at 1.4157, showing that the uptrend was still strong.

Representatives of the Department of studying Masterforex-V trading system assume that currently the EURUSD currency pair is shaping a short wave of the senior timeframe, the “MF Moment of Truth” for which will indicate the direction of the EUR mid-term trend.

If the MF pivot at 1.4010 and the MF Sloping Channel are broken through, the wave started at 1.3734 will be completed. If the price keeps declining and getting over the MF pivot at 1.3734, it will terminate the entire wave started at 1.2587. Otherwise the bullish wave will be elongated.

Nov 4^th 2010. Key news (GMT):

12:00     GBR - Bank of England Rate Decision

12:30     USA - Jobless claims, Nonfarm Productivity, Unit Labor Costs

12:45     EU - European Central Bank Rate Decision

13:30     EU - ECB Press Conference

 

 

 

 

 

Support/Resistance levels:

1.4305 - 161.8% + 223.6% + Oanda’s buy stops

1.4260 - 138.2% + 200%

1.4232 - 123.6% + 188.2%

1.423 – the current price

1.4010 - 38.2% + MF pivot + Oanda’s buy limits

1.3907 - 61.8%

1.3841 - 76.4%

 

 

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