Mike Paterson’s Daily Forex Brief

We’ve seen scrappy trading patterns again but the Euro remains undermined ahead of today’s key Non-Farm Payroll and Unemployment Rate data from the US.

EURUSD tried to get back above the pivotal 1.2970 area yesterday but failed miserably and the pair has since fallen this morning to break down through 1.2900 and trigger decent size stop-loss selling from 1.2890 down to lows so far of 1.2865.

Helping to give traders some momentum this morning has been some poor PMI data from around Europe and this coupled with the on-going assessment of the awful carnage left by “super-storm” Sandy has given the markets a decidedly soggy feel again, with a risk-off sentiment prevailing.

EURGBP had a rally yesterday from the strong support lines I’ve been talking about between 0.8000-10 but the renewed Euro pressure has seen us test the level again this morning, and as I type is breaking through after better than expected UK Construction PMI data coming through in complete contrast to the Eurozone figures earlier.

We shouldn’t get too excited ahead of the US jobs data but if 0.7985-95 ( GBPEUR 1.2515-25 ) gives way then we can expect some decent acceleration down to next support lines at 0.7965 ( 1.2550). GBPUSD is therefore lagging behind the EURUSD mover lower but has tested the 1.6080 area. Overall the Pound is lower in the past 24 hours so we shouldn’t get too excited about the UK even after the hint of better data out there.

So it’s all eyes on the US for lots of reasons right now, not least of which the small matter of a presidential election next week on which the jury is very firmly still out. First up though is that US jobs data at 12.30 GMT and with Mr B and the Fed aiming their pointers very much at the labour market we can expect some good volatility later.. Get those orders in. It’s fickle Friday after all!

Forex Update-The Economic Voice Limited

Forex Update-The Economic Voice Limited

We shall of course be hoping for a bit more mettle from the Shrimpers as they travel away in search of a first win for a while, and in the world of rugby union we learn of the strange goings on at Sale Sharks where, after losing all seven of their Premiership games this season, Bryan Redpath having been removed as Director of Rugby this week finds himself re-appointed as Head Coach but not responsible for First Team affairs.

A case of “can’t do with him, can’t do without him” but illustrating a loyalty in that sport that perhaps we don’t see too much elsewhere.

Have a great week-end whatever you’re up to.

Interbank Rates at 08:47 BST

Currency Pair


EURUSD 1.2880
GBPUSD 1.6091
EURGBP 0.8001
GBPEUR 1.2495
GBPCHF 1.5077
GBPAUD 1.5501
EURCHF 1.2077
GBPHKD 12.4753
EURHKD 9.9803
GBPZAR 13.9380
USDJPY 80.24
GBPCZK 31.5940

Today’s Data: BST

09.30-UK – Construction PMI

12.30-US – Non-Farm Payrolls / Unemployment Rate

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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