Mike Paterson’s daily Forex brief

The start of the week has picked up where NY left it on Friday with the Euro coming under further pressure and the Swiss Franc once again in hot demand after weaker than expected US jobs data gave further serious concerns for any global recovery. It's risk-off sentiment once again…Why it has ever been anything else over the past few weeks is what makes this market a real mess.

Greek debt problems are once again giving serious concerns as the bailout package causes serious divisions not least the German vote on Wednesday as to whether their bailout help is unconstitutional or not. Add to that mix some dramatic loss of support for Merkel, the IMF saying that any Greek bailout involving collateral would seriously undermine their position and ability to borrow, and Italy's own problems accelerating by the day.

EURUSD is down to 1.4120, and EURCHF collapsed to 1.10 on Friday but has recovered as traders still fear SNB intervention. EURUSD is now in risk of touching the bottom of its 1.40-1.45 range where only a few days ago it was looking to breach the topside. Fickle as fickle can be or what?!!…..There's still the usual buy interest out of Asia and plenty of option plays that will need defending but perhaps we are starting to see a sea-change….No point getting excited though until the range is broken but traders are definitely looking to sell Euro rallies right now.

Talking of which EURGBP is down to 0.8740 (GBPEUR up to 1.1450) having failed to breach 0.8900 (1.1255) but overall the Pound is still looking vulnerable to attack.

Gold has leapt higher once again and is now looking to target recent highs of $1910 again.That $1700-1730 level I spoke of in the recent dip has indeed been very important. Can only be a matter of time surely until we see another big slap lower in equities.

The RBA vote on interest rates tonight and the Japanese finance minister has warned that the Yen strength is unjustified and that intervention cannot be ruled out.

There's some data out this morning but the US are on holiday today which means it will be a thin and scrappy to start to the week……and frankly I can't see it getting any better.. Time to get your orders into the market and see what happens.

This ride is about to get a lot bumpier…….

Today's Data:

Weekly Economic CalendarHERE

Interbank Rates as of 08.19 BST

Current Price

Overnight

High

Low

EUR/USD

1.4122

1.4208

1.4112

GBP/USD

1.6146

1.6219

1.6135

EUR/GBP

0.8746

0.8774

0.8736

GBP/EUR

1.1420

1.1447

1.1395

GBP/CHF

1.2748

1.2801

1.2676

GBP/AUD

1.5277

1.5314

1.5205

EUR/CHF

1.1136

1.1205

1.1081

GBP/HKD

12.5180

12.5750

12.5100

GBP/ZAR

11.4329

11.5280

11.3863

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

Comment Here!

comments