Early Sino-US trade deal optimism.......>

EURO-DOLLAR: Early Sino-US trade deal optimism Friday saw EUR/USD touch a high

of $1.1199, helped in part by the sharp upside reaction in sterling to the UK

election result, but this early move faded and rate eased to an eventual low of

$1.1112, picking up momentum through the NY session. Details of the trade deal

dented the early optimistic tone, though it did prevent the implementation of

the Dec15 tariffs, with US-EZ trade relations moving into the spotlight. Firm

China data, with USD/CNY fixed below Cny7.00 for the first time since Nov12, saw

risk buoyed through the Asian session and allowed EUR/USD to edge its way back

up to $1.1144 into Europe. Expect technical resistance to emerge at

$1.1156/66(50%-61.8% retracement of Friday's pullback) with 76.4% close behind

at $1.1178 ahead of stronger area into $1.1200. Support $1.1110/00. 

- Option expiries of note for today's NY cut include, $1.1025-35(E3.18bln),

$1.1040-50(E1.0bln), $1.1055-63(E1.73bln), $1.1085-00(E1.57bln),

$1.1120-25(E1.25bln), $1.1150(E1.3bln), $1.1180-81(E516mln), $1.1200(E1.5bln).

- Focus on Flash EZ PMI data beginning with France at 0815GMT. ECB Lane and ECB

de Guindos speak at 1230GMT and 1300GMT respectively.