While yesterday’s rebound was largely driven by a rebound in the oil price, there was also an expectation that the People’s Bank of China could well augment its recent rate cut with further stimulus measures in the form of a cut to banks’ reserve requirements. This expectation wasn’t diminished one way or the other after this morning’s China services PMI data for November which while positive, still came in broadly in line with expectations, but still just above the nine month lows seen in October. Today’s focus as far as European markets are concerned, will be on today’s final November services PMI’s after Monday’s weak manufacturing numbers from Germany, France and Italy. Further weakness is expected from Italy, with a fall to 49.6 expected, while France and Germany’s numbers are expected to stay at 48.8 and 52.1 respectively. Spain is expected to continue to improve its general numbers with a rise to 56.2 from 55.9, if anything reinforcing the general narrative over the past few days from various German policymakers that monetary policy is no substitute for fixing euro area structural issues, of which there are many in Italy and France. It is these briefings, from ECB officials like Vice President Constancio last week, as well as comments from German ECB officials Jens Weidmann and Sabine Lautenschlaeger over the past few days, that would appear to suggest that any further measures aren’t likely to be agreed tomorrow, even though bond markets are already pricing them in, and currency markets appear to be starting to. On the plus side there is an expectation of a recovery in October retail sales data for the euro area after a fairly strong German number last week, with expectations of a rise 0.6%, a significant improvement on the 1.3% decline seen in September. In the UK the main focus today will be on the Autumn Statement from Chancellor George Osborne, though the pound is likely to react more to the latest Services PMI data for November, which is expected to remain fairly resilient with a slight improvement to 56.5, from 56.2 in October.Anyone expecting anything noteworthy is likely to be disappointed, with any eye-catching measures likely to be kept back for the budget in March next year, which comes just weeks before the May election. The fact is the Chancellor is already well off course with his borrowing target for this year, which severely limits his room for manoeuvre, and he will no doubt be hoping that the tax deadline in January provides him with a nice windfall, narrowing the miss. Businesses will be hoping for some measures to help with the costs of doing business with food retailers in particular, given the terrible year they are having hoping that next year’s business rates revaluation on commercial property, which is due in April, doesn’t drive their costs even higher. In the US we get the appetiser for Friday’s employment report with the latest ADP employment report for November, which is expected to see an extra 230k jobs added, up from the 223k added in October, as well as the latest Beige Book business conditions survey. EURUSD – the pressure on the downside remains while below trend line resistance at 1.2520 from the October highs at 1.2887 with the recent lows at 1.2355 the key support. While above these lows the possibility remains for a move towards 1.2600. We need to move below 1.2350 level to target a move towards the 1.2040 level. GBPUSD – the lack of a meaningful rebound keeps the pressure on the downside and the support at the 1.5590 area. Last month’s lows remain a key support, a break of which could well push down towards 1.5210, which is trend line support from the January 2009 lows at 1.3500. The fall back below 1.5700 keeps the pressure on the downside and we need to move back through here to retarget the highs this week at 1.5765. EURGBP – while the support at the 0.7900 level holds the risk remains for a move back towards the 200 day MA at 0.8035 as well as trend line resistance from the September highs at 0.8025. For now we seem to be range trading but the risk remains for a fresh move lower, back towards the 0.7870 level. USDJPY – we’ve seen another new high this week above the 119.00 level as the US dollar gets drawn towards the 120.00 level. The current move continues to look overextended but we could well continue to push higher in the short term. Behind 120.00 we also have trend line resistance at 122.90 from the April 1990 highs at 160.30. The risk of a pullback remains, but while support at 117.30 remains, buy on dips remains the strategy here. CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.