Mike Paterson’s daily Forex brief

The Euro has once again come under intense pressure, as forecast here, after the short-covering I mentioned yesterday ahead of the US Thanksgiving holiday.

That rally on EURUSD petered out at the technical resistance levels around 1.3410 and for the rest of the day we saw fresh sellers emerge as concerns over the Eurozone debt crisis once again took centre stage. The continued German opposition to greater ECB involvement/assistance, downgrades of Portuguese and Hungarian debt and the knock-on effect caused by the poor Bund auction all added to the bearish sentiment and it wasn’t long before we were heading back down to challenge strong support around 1.3325. Overnight this has given way and this morning large bids at 1.3300 and 1.3290 have been smashed to create fresh lows of 1.3265. Talk now of more bids from the usual suspects around 1.3250 but the target is now 1.3150. Sellers will re-appear around the pivotal 1.3325 level.

EURGBP had also staged a small recovery yesterday morning but couldn’t get beyond the 0.8620 resistance (GBPEUR 1.1600 support) and duly turned back lower, but is now still finding support around the pivotal 0.8580 (1.1655) area  A break through here should see a test to the next support line at 0.8550 (1.1696).

GBPUSD fell through strong support at 1.5510 and then even stronger technical support at 1.5484 on the back of the EURUSD losses and general risk-off sentiment but we expect buyers between 1.5425-1.5440. Should the selling pressure continue then 1.5360 is the next target.

Gold and equities have also been sold as the doom n gloom continues but both are off their lows as I type.

Daily Forex Brief

Daily Forex Brief

I warned yesterday that thin markets increase volatility by reduced liquidity more often than not and with many Americans taking a long week-end to nurse their Thanksgiving hangovers we’re in for another lively day today whether traders are up for it or not. Little in the way of data so we’ll just have to see whether the technical levels hold and we see another bout of short covering ahead of the week-end. But there’ll be plenty of sellers around again I’m sure.

Have a good week-end folks.

Today's Data:

Nothing of note today

Weekly Economic CalendarHERE

Interbank Rates as of 08:17 BST

Current Price

Overnight

High

Low

EUR/USD

1.3275

1.3353

1.3265

GBP/USD

1.5461

1.5499

1.5447

EUR/GBP

0.8584

0.8619

0.8579

GBP/EUR

1.1651

1.1658

1.1600

GBP/CHF

1.4310

1.4318

1.4234

GBP/AUD

1.5962

1.5982

1.5909

EUR/CHF

1.2278

1.2289

1.2262

GBP/HKD

11.9869

12.0164

11.9760

EUR/HKD

10.2883

10.3589

10.2719

GBP/ZAR

13.2160

13.2647

13.1033

USD/JPY

77.45

77.54

77.10

GBP/CZK

3.0112

3.0234

2.9819

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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