Mike Paterson’s daily Forex brief

Last week I said that we can’t rule out a rally of some sort before Xmas as the down move runs out of steam and traders look to square positions, and that’s what we’re getting at the moment, albeit not in a straight line.

EURUSD has just stalled again at the key 1.3145-55 area that was such a strong support on the way down, having touched 1.3132 yesterday before retracing to 1.3064… While the rallies are being sold there is no doubt that we’re seeing buy interest in the dips, but with all the year’s movement and volatility we’re still fairly much where we were this time last year………..

With the market in generally more bullish tone we’ve seen advances too in the commodity currencies with AUD/USD finally pushing through that 0.9980 area I mentioned yesterday and so far touching 1.0213, bring GBPAUD back down to 1.5388 at its lowest point. GBPZAR too is lower as the Rand finds support on a higher Gold price ($1632).

EURGBP moved lower yesterday at one point dipping under 0.8340 (GBPEUR up above 1.1990) as EURUSD peaked for the first time at 1.3132 and with end of year demand for GBPUSD still we seen little attempt by EURGBP to move back much higher at present. Immediate resistance is now at 0.8380 and 0.8420 with support at 0.8330 and 0.8300.

Forex Brief Wed

FX Update

09.30 GMT brings us the UK’s MPC Minutes from the last interest rate meeting but not expected to deliver too many surprises, while traders also await LTRO details from the ECB.

All in all expect more of the same and just as fragmented.

STOP PRESS: BOE MPC members voted 9-0 to keep interest rates and QE on hold. No reaction as expected.

Today's Data:

09.30-UK- BOE MPC Minutes / PSNBR

15.00-US- Existing Home Sales

Interbank Rates as of 08:38 BST

Current Price

Overnight

High

Low

EUR/USD

1.3149

1.3155

1.3075

GBP/USD

1.5744

1.5750

1.5656

EUR/GBP

0.8353

0.8377

0.8344

GBP/EUR

1.1971

1.1986

1.1936

GBP/CHF

1.4596

1.4606

1.4538

GBP/AUD

1.5441

1.5577

1.5388

EUR/CHF

1.2192

1.2203

1.2168

GBP/HKD

12.2063

12.2110

12.1381

EUR/HKD

10.1966

10.2304

10.1268

GBP/ZAR

12.7780

12.8790

12.6883

USD/JPY

77.81

77.91

77.69

GBP/CZK

3.0462

3.0647

3.0453

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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