Mike Paterson’s daily Forex brief

We’ve seen some good two-way business in tight ranges in the past 24 hours as the key support and resistance levels hold firm for the Euro ahead of the next decent move.

EURUSD failed to hold above 1.2800 on yesterday’s continuing rally and fell back from a high of 1.2808 to lows around 1.2730 again where we have strong technical support and a few name buyers lining up. In Asia we’ve seen a move back up which was curbed by comments earlier this morning by Fitch ratings agency that they cannot rule out a double-notch Italian down grade. And for all of those out there wondering why we don’t have European ratings agencies we should remember that Fitch is in fact owned by a Frenchman, which doesn’t prove much admittedly whichever side of the debate of “who the heck are these guys from across the pond to judge?” that you might be on.

Anyhow we saw a dip back below 1.2750 on that news but we’re making another attack on 1.2800 as I type, perhaps trying to force into play the stop-loss buy orders reported above 1.2810-20.. So far we’ve hit 1.2816 but now back down to 1.2785 as the rally-sellers prevail. Jumpy morning or what…………..?

EURGBP has camped itself above 0.8300 ( GBPEUR below 1.2048 ) and is now looking to test 0.8350 resistance while GBPUSD still struggles to break up through the strong sell interest at 1.5400 that I mentioned yesterday. Good bids at 1.5330-50 and sell orders at 1.5400 and 1.5400-20. The Pound overall has been a mixed bag of average contents, with losses for the most part but bouncing a little from 27-year lows of 1.4702 on GBPAUD.

FX Update

FX Update

EURAUD has also seen a bit of profit taking from its all time lows seen yesterday and that’s dragged AUDUSD back down below 1.0400. Strong bids rumoured at 1.0350 so we can expect good two-way here too.

UK employment data just out shows 1,200 more jobless claims taking the total to 2.685 million and an overall rate of 8.4%. In line with expectations so no real impact for the moment, but it’s not good news and will only get worse.

US data out this afternoon should keep things ticking over but it’s still looking like a decent battle at these levels as I sign off.

Talking of which, our cricketers seem to be striking back a little in Dubai against Pakistan this morning, but still have a lot to do. As we look out the window on a murky damp UK day let’s remember it’s only about 12 weeks to the start of the cricket season. Hurrah!

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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