All it took for US stocks to move to new all-time highs yesterday was for Russian President Putin to announce that Russia wasn't looking to annex the Crimea and that additional troops would only be sent into Ukraine under extreme circumstances and in observance of international law. This softening of tone by the Russian President, Putin even stated that the Crimea operation was primarily a humanitarian one, saw US markets soar to new record highs and US 10 year bond yields jump almost 10 basis points as investors piled back into stocks, and out of US treasuries. Gold also slipped back, but crucially still remains higher on the week, suggesting that not everyone is as convinced as equity market investors, about this softening of tone from Russia. The fact is the situation in Ukraine still remains quite fluid and liable to change at any moment, the brief market reaction to the launch of a Russian ICBM being a classic case in point last night. The US continues to look at possible options for sanctions, though EU leaders continue to tread much more carefully given their reliance on Russian gas imports. While the Ukraine saga looks set to rumble on and Europe's markets get set for a slightly negative open the focus can now shift back to the mundane matters of economic data with the final services PMI data for France, Italy, Spain and Germany and it will once again paint a mixed picture with Germany and Spain outperforming, coming in at 55.4 and 55 3 respectively. France and Italy, on the other hand are expected to contract, with Italy coming in at 49.9 and France at 46.9. The latest revision to EU Q4 GDP numbers are also due to come out with no change expected from the previous number of 0.3%. Last week's rise in German retail sales is expected to trickle down into a similarly positive reading for the latest EU retail sales numbers for January with a rise of 0.8% expected, up from the 1.6% decline seen in December. In the UK the latest services PMI number for February is expected to complete a fairly strong set of PMI numbers for this week, with a reading of 58, slightly down from 58.3 in January. The construction numbers came in slightly weaker yesterday, largely as a result of the weather and there is a chance of a similar outcome in services, though it is likely to be short-lived. Back in the US we have the appetiser for Friday's payrolls report with the latest ADP employment report for February. One of the curious things about the ADP report is that it hasn't been anywhere near as badly affected by the weather as the official BLS payrolls report has been in the last few months. It is still expected to come in a little softer at 155k, down from 175k in January, so we shouldn't expect too many surprises here. It is also important not to read too much of a correlation into Friday's number either as the ADP rarely acts as an accurate guide. Of more importance is the publication of the latest Fed Beige Book of economic conditions which is due later in the day, as it will give a much more accurate indication of the effect the recent cold weather has had on economic activity throughout the different Fed regions and is likely to be a much more accurate bellwether to the health of the US economy than the recent rather more erratic economic data seen in recent weeks. EURUSD - the euro needs to break above trend line resistance at 1.3835 from the 1.6040 highs this far to target further gains towards 1.4000. The euro bias still remains negative while we remain below 1.3835 but the lack of any dip does raise the concern we could push higher. Dips are likely to find support at 1.3720 and 1.3640, last week's low. GBPUSD - the pound continues to drift lower and the risk remains for a move back towards strong support at 1.6600, while below the highs last month at 1.6820. Only a close above 1.7000 could have huge significance in the coming weeks for the future direction of the pound. EURGBP - the negative bias remains for a move back to the lows at 0.8160, while below resistance near the 0.8270/80 area. A drop below 0.8160 targets a move towards the 2010 lows and 0.8065, while a move above 0.8280 targets 0.8325. USDJPY - yesterday's rally has brought us back from the lows at 101.35 but downside pressure continues to prevail for a move back towards 100.75. A break below the 100.20 level and 200 day MA could well see further losses towards 98.30. The US dollar needs to overcome the 102.80 level to retarget a move back through 103 towards 105.00 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. 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