European bonds are seeing some good business today as yields take a dive. Italy had a good auction today with the yield at it’s lowest since 2005. Currently they are trading at the lowest since around April 2006. Both Italy and Spain are now down through the 3.50% mark.

Despite the drag from selling in the yen cross the Euro is remaining resilient and the fall in yields is going some way to support this.

Should we have a look lower there’s an interesting convergence of the August 2013 and broken Dec resistance line at 1.3631 and under there we have the 100 dma at 1.3622.

EUR/USD daily chart 27 02 2014

EUR/USD daily chart

As I pertained to in my yen post just now, these are the types of stronger levels that I would be looking at to hold on a move down but even so the headlines will trump the tech if they’re wild enough.