Mike Paterson’s daily Forex brief

More fun and games as the day progressed yesterday and overnight as the ramifications of yesterday's move by the SNB filters through the markets.

With EURCHF holding steady above the minimum 1.2000 but not really make any great advances, traders once again turned to the Eurozone mess and sold off the Euro once again as they had been looking to do first thing yesterday. From peaking at 1.4284 after the SNB announcement EURUSD came all the way back down to finally break the 1.4000 level with USDCHF rising above 0.8600 to take up the EURCHF slack.

A combination of Greek bailout issues and talk of Eurozone withdrawal, rumours of Spanish bailout required, talk that the Italians won't take their austerity medicine all made the Euro the main target again.  EURGBP did drop a little but with the UK relying so heavily on their European trading partners and experiencing problems of its own we've seen a move back to 0.8830 (GBPEUR down to 1.1335).

We saw a sharp spike up in the Euro a little while ago with EURUSD jumping over 100 points to 1.4148 on news that the German constitutional court rejects lawsuits aimed at blocking German participation in Eurozone bailouts. This was as expected and the Euro's reprieve was short lived with a drop of 100 points to where it started.

Elsewhere the Pound has also suffered (see rate table below) with GBPUSD getting slapped down again and breaking below 1.6000 where it currently remains.

So with the CHF engineered lower and gold looking a little top-heavy for the moment around $1900 where are investors placing their safe-haven cash? Step forward the Norwegian Kroner which soared yesterday amidst all the mayhem. Time will tell how much of a long term haven this will be but hey, any port in a storm and right now Norway is as good as it gets along with its neighbour Sweden which I’ve talked about previously.

Various data to mull over today but nothing of great substance. Focus will start to fall on tomorrow's interest rate announcements from the BOE and ECB and the all important ECB press conference afterwards.

Expect more volatility again today as traders still try and deal with the SNB aftershock and Eurozone developments.

Today's Data:

Weekly Economic CalendarHERE

Interbank Rates as of 08.19 BST

Current Price

Overnight

High

Low

EUR/USD

1.4087

1.4149

1.3992

GBP/USD

1.5990

1.6041

1.5932

EUR/GBP

0.8807

0.8830

0.8775

GBP/EUR

1.1345

1.1401

1.1336

GBP/CHF

1.3685

1.3757

1.2664

GBP/AUD

1.5053

1.5217

1.5047

EUR/CHF

1.2063

1.2085

1.2033

GBP/HKD

12.3970

12.4370

12.3520

GBP/ZAR

11.3306

11.4944

11.2994

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

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