Mike Paterson’s Daily Forex Brief
With traders not sure what to do next with the Euro attention has remained on the Aussie dollar and concerns that the region could be facing sharp decline.
With RBA Governor Stevens now saying that the mining sector boom will peak earlier than expected and Chinese Non-Manufacturing PMI falling to 53.7 for September from the previous 56.3 for August, there are genuine reasons why the region could be in for a very bumpy landing.
These are fears I have expressed for some time and the knock-on effect on the rest of the world cannot be underestimated.
AUDUSD has fallen again to 1.0201 with the reversal in EURAUD having had most impact on the price action, rallying as high as 1.2646 so far. GBPAUD is back above 1.5750 and almost breached 1.5800 before the sellers emerged. AUDJPY has also come under fire too.
The EURAUD buying has kept the Euro well supported in ever-tightening ranges with EURUSD trading 1.2877-1.2920 and EURGBP looking perky again above 0.8000, and looking to go higher as I type as EURUSD has another test of the top side.
GBPUSD has been on a slippery slow slide (try saying that after a couple of beers) for the past few sessions since the heady highs above 1.6250 last week and so far we’ve seen lows of 1.6083.
Concerns remain of course over the Eurozone, notably Greece and Spain still, but the Euro seems to be developing a teflon coat at these lower levels, for the moment at least.
Various bits of data today with UK Services PMI out at 09.30 BST, Eurozone Retail Sales at 10.00 BST and the US ADP Non-Farm jobs revision at 13.15 BST, all of which could well have impact, but it remains very scrappy out there.
Love him or loathe him it looks like Kevin Pietersen is coming back into the England cricket team with an announcement due today. There’s no doubt we can do with his precocious talent but at what price to dressing room morale?
Interbank Rates at 08:32 BST
Today’s Data: BST
09.30-UK – Services PMI
10.00-EU – Eurozone Retail Sales
13.15-US – ADP Non-Farm Employment Change
15.00-US – ISM Non-Manufacturing Index
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Mike ‘Oscar’ Paterson has been in the Forex trenches for nearly three decades working as a senior Spot trader in London at UBS, Chief Dealer FX at the State Bank of Victoria and in charge of Spot CHF at Credit Suisse with a daily turnover in excess of $1.5 billion. Mike now works as an independent consultant providing a fully bespoke service to the corporate and private sectors in physical FX delivery as well as guiding those who wish to improve their currency trading. Mike also presents seminars and workshops and writes for a number of publications.
To contact Mike please call +0044 (0) 1732 700383 or email email@example.com
The views expressed above are those of the author and should not be taken as investment advice. MSP Foreign Exchange Services will have no liability for, or to, any persons executing trades based on the content above.