EUR/USD baulked at the sell orders placed above 1.4060 a little earlier and has retreated to more comfortable territory around 1.4030. The moves so far today can best be described as tentative. Equities, commodities, risk currencies – tentative after yesterdays bloodbath. It is difficult to be confident about “risk” trades in the current environment. We have been down this path before of course and the Euro has recovered. Somehow I don’t think so this time round. It looks for all intents and purposes that we are heading towards some resolution – the muddle through/ kick the can down the road a little further policy looks to have run its course. Whilst it might end up all good for the Euro in the long run, the initial reaction will be to sell.