Mike Paterson’s daily Forex brief

Following on from the previous day’s fall in the US dollar the Euro is finding some good support from a variety of sources as month-end looms.

Talk that the IMF were buying a few for the Greek bailout, the usual month-end EURGBP buying interest from the Bundesbank for UK EU payments and EURAUD buying as the Aussie $ falls again (I did say yesterday that the AUD rally looked weak) have all helped to give a base to the Euro and helped its advance.

EURUSD held around the 1.3315 level I mentioned yesterday too (see, I really don’t make these up!) but we’ve yet to break up through the next barrier-option sell level of 1.3400. EURGBP has moved up through the 0.8365 resistance and we’ve been up to test the next line around 0.8400 (GBPEUR 1.1905), while EURAUD has climbed to 1.2824 and EURJPY up to 110.89 before capping.

The Pound has failed to make any impression apart from against the under-pressure Aussie, GBPUSD did have another pop at 1.6000 yesterday but failed to penetrate and fell back quite easily.

Final Q4 GDP data just out at – 0.3% is the lowest reading since Q4 2010 and the even the +0.5 % for year-on-year is down from the previously revised +0.5%. Current Account came in around expectations at – £8.45 billion. We’ve seen a further sell-off in the Pound since the news but it’s finding some consolidation as I type.

Equities and Gold have fallen back from yesterday’s rally as I anticipated and we’re back into-range trading mode.

Little else in the way of data today but we do have US Durable Goods at 13.30 GMT. Apart from that we can expect more of the same with month-end flows having an impact.

Forex Update-The Economic Voice Limited

Forex Update-The Economic Voice Limited

Meanwhile, back in Sri Lanka, Swanny grabs a 6 wicket haul but England let them off the hook once again from 84-5 and has a mammoth task in running up 340 to win. They’ll have to bat with a load more discipline if they are to get anywhere near it but hey, plenty of overs to do it in!

And in Portugal Chelsea had a great night surely shortening Di Matteo’s odds for the job full time….While back in League 2 , rivals Crawley get involved a punch-up at the final whistle and the referee sends off 5 players in total from the depths of the changing rooms…You couldn’t make it up!

Agree or disagree? Then please leave a comment in the box below or contact me by e-mail.

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 mike.paterson@economicvoice.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.

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