Closed in NY Friday at $1.3077, just off pullback lows of $1.3070, with rate opening into Asia around $1.3100 (session highs) before turning lower again. Rate had drifted down to $1.3062 in Wellington before DJ reran the story that Moody’s would announce their decision on ratings for a large number of European banks. This is an old story, released Friday and is highly anticipated for early May. However, rate dropped through corporate demand at $1.3050 extending lows to $1.30089 before US name buys, sitting ahead of a well reported barrier at $1.3000, kept rate buoyed. Rate settled between $1.3015/30 through to the European open. One trader suggests that the reaction in Asia to the Moody’s story may be overdone and sees market open to a short squeeze which could take us back up to $1.3065. The underlying tone though remains negative with traders looking to short, either on a break of $1.3000, or would look to more comfortably short into $1.3120/40. Bids seen into $1.3000, stops below with more seen sitting on a break of $1.2985. Offers $1.3165 (61.8% $1.3100/1.3009).
EasyForexNews Research Team