Mike Paterson’s daily Forex brief

It would appear the immediate euphoria for the Euro, after the Fed’s easing message on Wednesday, is starting to wane already but it’s all still in the balance for sure.

EURUSD yesterday capped at 1.3184 after another rally following strong Italian auction results but the 1.3200 big barrier I talked about was definitely a step too far at this point and with some real money sellers returning to the market we’ve seen a reversal of sorts to 1.3078 before finding further support.

Interestingly though other key Euro pairs have fallen too and this suggests the upward momentum has gone, for the moment at least.. EURAUD has dipped to 1.2290 while EURJPY has fallen significantly to 100.82 having breached 102.10 yesterday.. Perhaps traders feel that not only was the Euro move over-cooked but that it would be churlish for the BOJ to step in to weaken the Yen whilst the mood was USD negative.. Either way we’ve continued to see a fall in USDJPY to 76.90.

EURGBP failed again to breach 0.8400 (GBPEUR 1.1905) and has also fallen to 0.8337 (1.1995) just ahead of a decent technical support line around 0.8330 (1.2005).

Adding to the Euro reality check was a comment by EU’s Juncker that the ECB would not take a hit on its Greek debt exposure, but in European trading so far we’ve seen good two-way business with the Euro consolidating at these lower levels.

Forex Update

Forex Update

Little in the way of data today but this afternoon brings us the initial Q4 GDP figures from the States and ECB President Draghi is up just before that. Another scrappy Friday ahead for sure.

A mixed bag on the sporting front as I sign off with Andy Murray losing the first set but England taking a couple of early wickets having added 120 this morning.. Definitely in a strong position but as ever with any England set-up it’s far too early to get too carried away..No Shrimper action ‘til Tuesday so I shall just have to make do with some neutral FA Cup watching to alleviate some intense decorating boredom!

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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