The Risk of a 'hung' parliament in the UK keeps the Sterling pressured!

•  Yesterday's trading session saw the Euro trade in a 100 pip range and the USDJPY in a 40 pip range. US stock markets initially rallied on news AIG were selling a Unit of Met life for $15bln and on McDonalds 4.8% increase in sales, by the end of the session equities closed almost unchanged. No serious market moving economic reports were released and the markets decided to consolidate and reconsider current market positioning. 2 year US Treasury yields fell yesterday to 0.88% after hitting a high of 0.92% on Friday following the NFP report, USDJPY tracked the yields and traded to a low of 89.89.  
•  The main theme in Europe yesterday was the discussion of a new European Monetary Fund. ECB's Stark was reportedly saying that an ''EMF'' would be against the European Monetary Union rules whilst Germany's Angela Merker said the idea was interesting. Germany has still to commit on aid to Greece saying that no financial aid was requested. Currently we are also seen a political backlash blaming speculators for the aggressive attacks on the Euro and Greek Government bonds. Germany Industrial production for January came out below expectations at 0.6% mm. EURUSD price action was between 1.3700 - 1.3600.
•  In the UK fears remain over a ''hung'' parliament meaning that the UK Government will become the minority in the House of Commons and thus find it difficult to get new legislation passed. This is a concern in a time were tough austerity measures need to be introduced so as to bring the Country's massive deficit back in check. GBPUSD price action yesterday was between 1.5200 - 1.5000.
•  Today the focus turns to the UK trade balance expected to have dropped by GBP7bln for the month of January. In the US we have the weekly Redbook reports and the IBD Economic Optimism report for March.

 Currency to watch out for: EURUSD & USDJPY

• § The EURUSD pivot point is at 1.3695 with a preference to enter into short positions at 1.3685
• § The USDJPY pivot point is at 89.75 with a preference to enter long positions at 89.80

 Today's calendar and market movers:

• § UK Trade Balance for January expected to fall by GBP7 Bln
• § US IBD Economic Optimism for March, previous months reading was 46.8

 Equity Markets:

•  US equities closed negative yesterday with the DJIA and the SP500 closing -0.13% and -0.02% respectively.  The European bourses were mixed yesterday with the FTSE up 0.12% the DAX and the CAC closing at 0.02% and -0.18% respectively.  The NIKKEI and the HSI at the time of writing is -0.17% and -0.09% respectively.