Mike Paterson’s Daily Forex Brief

It’s been an understandably quiet 24 hours after the previous few sessions with focus firmly on the German ruling on ESM tomorrow and the US interest rate/QE decision on Thursday. And lest we forget it is the eleventh anniversary of 9/11 …….

We’ve been in tight ranges but had plenty of sharp moves to keep traders on their toes. EURUSD is finding support at the 1.2750 pivot level but struggling now to get above 1.2800 again while GBPUSD seems to have found decent support around 1.6000 but plenty of sellers approaching 1.6050.

EURGBP too has been trading tightly, having had another burst higher yesterday to 0.8019 (GBPEUR down to 1.2470) but since then has tried the down side around 0.7975 (1.2539) before the buyers stepped back in.

There’s been talk that the ESM ruling may be delayed but Chancellor Merkel’s spokesman insisted that the ECB’s plan to buy unlimited sovereign bonds from countries being supported by bail-out funds – the Draghi Plan – should not impact on the court ruling. However, the court said it would consider the request and announce its decision on Tuesday. A delay could push ratification of the fund back until next year, when countries including Spain are expected to require help imminently.

Who mentioned can-kicking again…?

Overall the Pound and Dollar have had mixed bags but with Trade Balance figures out from both today we should see some reaction.

Forex Update-The Economic Voice Limited

Forex Update-The Economic Voice Limited

The Troika have given Greece short order on their austerity package, accepting only €6 billion of their proposed €11.5 billion savings and told them to go back and think again to include more Public Sector sackings. That’s not going to go down too well.

A potentially lively day ahead dependent on that news from Germany but with plenty of technical support and resistance to keep ranges defended perhaps.

Andy Murray finally gets the massive monkey off his shoulder by winning the US Open, to become the first British major winner in 76 years. Congrats and relief all round to add to a stunning summer of sport

Stop Press: UK July global trade balance narrows to – £ 7.15 billion from June’s -£ 10.07. Non-EU goods deficit narrows to best data since October 2005. Little reaction yet from the Pound though as I sign off.

11 years on from 9/11. We will never forget.

Interbank Rates at XX:XX BST

Currency Pair

Current

Overnight

High

Low

EUR/USD 1.2798 1.2819 1.2754
GBP/USD 1.6024 1.6029 1.5983
EUR/GBP 0.7986 0.8000 0.7973
GBP/EUR 1.2519 1.2543 1.2498
GBP/CHF 1.5116 1.5154 1.5080
GBP/AUD 1.5463 1.5506 1.5457
EUR/CHF 1.2074 1.2093 1.2060
GBP/HKD 12.4234 12.4272 12.3916
EUR/HKD 9.9236 9.9433 9.8793
GBP/ZAR 13.1740 13.2040 13.0445
USD/JPY 78.20 78.30 78.16
GBP/CZK 30.7237 30.8700 30.6559

Today’s Data: BST

09.30-UK – Trade Balance

13.30-US – Trade Balance

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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