Mike Paterson’s Daily Forex Brief
A lively 24 hours with first a dip in the Euro as Eurozone fears continued to rise, but then we saw a concerted rally as the buyers won the day and forced the shorts to run for cover.
But news of Greece starting to sell off the family silver put the skids under it again and then overnight poor Chinese PMI added to the risk-off sentiment as traders once again ran for cover.
EURUSD had fallen to 1.2993 but then saw a brisk rally only to run into sellers around good resistance lines at 1.3085 and settled back around 1.3050. Overnight though the risk-off sentiment has sent it crashing to 1.2940 before attracting a few buyers.
EURGBP similarly has had a roller coaster ride, first moving down to 0.8015 (GBPEUR up to 1.2476), then back to 0.8047 (1.2425) and then following the Euro down overnight to 0.8003 (1.2497).
We’ve seen a big move though in EURJPY as the buying interest after the BOJ ease came to a grinding halt and the risk-off scenario has seen traders jumping back into the Yen, with USDJPY falling 100 pips back to 78.03 and EURJPY down from 102.47 to 101.07.
With Greece looking to sell off its family silver to placate the Troika the Minister of Development said “desperate times call for desperate measures”. The sales include palaces, embassies, marinas and airports, as well as some 40 islands that have been targeted for leasing.
With the Spanish rioting again on the streets it’s a timely reminder, after last week’s euphoria, that all is not well in the Eurozone, and with the Chinese PMI (Purchasing Managers Index) coming in weaker than expected, followed up by the French PMI this morning falling to 3 1/2 year lows, it’s not looking good out there again.
Expect another lively day.
Seems like Chelsea learnt from City in how to throw away a match-winning opportunity but England’s ladies football side fared better by securing qualification for the Euros next year and hopefully stake a claim for greater recognition of their rapidly growing skills.
Interbank Rates at 08:46 BST
Today’s Data: BST
09.30-UK – Retail Sales
11.00-UK – CBI Industrial Trends Orders
13.30-US – Weekly Jobless Claims
15.00-US – Philadelphia Fed 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 firstname.lastname@example.org
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.