Failure Thursday to extend recovery.....>

EURO-DOLLAR: Failure Thursday to extend recovery above $1.2400, the rate having

met decent resistance/supply at this level, saw rate drop back to $1.2329 after

the London fix before rate settled around $1.2350 into the close. A fairly

subdued Asian session though the Usd was able to build on gains with Eur/Usd

easing to settle through the session around $1.2340(range $1.2336-49). Asian

traders mentioned talk of offers at $1.2350(suggested to be linked to large

option expiries at this level next Mon/Tue) opposed by demand in the $1.2335/30

area. Traders aware that the $1.2305/00 area holds the strikes of expiring

options for today's NY cut, amount E1.45bn, and could draw demand ahead. One

tech trader spoken to has suggested that the rate could find decent support in

the $1.2320/00 area then looks for a sharp bounce to $1.2420, possibly on to

$1.2470. EZ Consumer Confidence provides domestic interest at 1400GMT.