Mike Paterson’s Daily Forex Brief
Friday’s Non-Farm Payroll number came in at 96,000 versus expectations of 130,000 and markets duly concluded that the Fed will introduce further monetary easing when they meet this week.
And following on from Thursday’s Draghi plan the Euro has been making the most of this Dollar uncertainty with EURUSD rising through more key resistance levels to 1.2817 before falling back overnight in Asia. Support now comes just below current levels at 1.2750-60.
EURGBP has also seen another decent rally up to 0.8006 (GBPEUR down to 1.2490) before retreating as EURUSD fell back through 1.2800. Support now comes in at 0.7980 with larger buying interest on the 0.7960 pivot level but then I hear plenty more down at 0.7935.
GBPUSD also benefitted from the USD sales reaching 4 month highs of 1.6034 but it hasn’t been keeping pace with the others leaving the Pound lower overall ( see rate table below ).
Adding to the Euro’s support has been a significant move higher in EURCHF over the last few days, started initially by the SNB reported to be in placing buy orders above its official peg of 1.2000. This sent shorts running for cover, and then when the usual retracement back down again didn’t happen we saw another burst through strong resistance at 1.2060 and then another wave of buying through 1.2100 on Friday as more shorts got well and truly squeezed.
Little in the way of data out today but that’s not important given what’s coming up this week with the ESM validity ruling, FOMC meeting, and on-going talks between Greece PM Samaras, the Troika and his own party leaders.
Let’s not forget that the Euro is hardly out of the woods just yet and the Draghi Plan could yet be classified as sovereign debt default by any other names so it’s not going to be one-way traffic.
This week promises to be a watershed moment and you’ll be advised to get your orders in whatever side of the market you’re sitting.
The Paralympics are over and we can only hope the perception of these amazing athletes has been raised to new levels. I’ve been thinking that one big test of just how far we’ve come will be how many knighthoods and other honours are bestowed upon these guys and girls.
Able-bodied athletes have been decorated liberally in recent years so a similar recognition must be paid surely………
And the mighty Shrimpers secured another 3 points to maintain their delayed charge to the top of the table, while Andy Murray has another stab at landing his first major later today.
The sun may have gone back in but it’s going to be an illuminating week.
Good luck out there.
Interbank Rates at 08:46 BST
Today’s Data: BST
Nothing of Note
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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 firstname.lastname@example.org
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.