Politics will continue to dominate the.........>

EURO: Politics will continue to dominate the outlook for the single currency

zone in the short term, with the postal vote for Germany's SPD Party members to

express their view on a coalition with Merkel's CDU/CSU bloc opening on Tuesday

(they have until 02 Mar to submit their votes).

- The right-wing AfD party has surpassed the SPD in the latest opinion poll,

heaping the pressure on the party to reach an agreement. It has been given

various key ministerial posts by the ruling coalition, although former party

leader Schulz has had to step down amidst party pressure re: "flip flopping".

- Although the SPD is expected to OK the coalition, it is by no means a foregone

conclusion. If it does not vote in favour of the deal Merkel may attempt to

govern via a minority gov't or Germany will head back to the ballot box.

- For EURUSD '18 & 3yr highs lacked follow through with the pair rejected ahead

of Dec '14 monthly highs & the LT bear channel top ($1.2649) off '08 highs

Friday. Bears need a close below $1.2368 to pressure $1.2167-1.2299 where the

bull channel base off '18 lows is found. Bulls need a close > $1.2461 to gain

breathing room & above $1.2515 to retain focus on the weekly bear channel top.