Greeks Negotiates Politics, Berlusconi Fights on, EURUSD Below 1.37

Risk aversion creeps up amid ongoing wrangling on Greek politics following PM Papandreou's offer to step down, Berlusconi fights on to stay as Italian bonds extend their downfall. Eurozone Sep retail sales continued fall. See the latest on Friday's Premium trades below.

1 day after PM Papandreou won his confidence vote, he offered to stepped down to make way for a new coalition government, likely to be led by a temporary non-political personality with strong economic credentials. Papandreou & opposition leader Samaras have yet to agree between frontrunners Lucas Papademos (ex ECB VP) and Stavros Dimas (former EU commissioner with World Bank experience). The good news is that political leaders realise the importance of implementing the latest 130 bln package and keep the 8 bln tranche by year-end.

Meanwhile, EU leaders are urging Italian PM Berlusconi to step down in order to allow the full implementation of the reforms aimed at cutting Italys 1.9 trln debt. Yet Italy is already under the monitoring of the Troika, as the European Commission, the IMF and ECB are carrying out their technical assistance, laying out economic metrics and the purchasing of Italian bonds. Investors are closely watching Italian bond yields, whose 10 year yields are up at a record post-Eurozone high of 6.63%.

Eurozone Sep retail sales -0.7% vs exp -0.1% from -0.1%. -1.5% y/y from -1.0%. Eurozone Sep Sentix Investor Confidence -21.2% from -18.5% vs exp -20.0.

UK Oct Halifax house prices rose 1.2% from -0.3% vs exp 0.1%

One of our EURUSD & EURJPY Friday trades hit all targets, one EURUSD long remains in progress, another 2 unfilled. For direct access, click here: http://ashraflaidi.com/products/sub01/access/?a=543 For non-subscribers, click here: http://ashraflaidi.com/products/sub01/