Opened early Europe at $1.6281 stg0.8138, GBP closed in NY at $1.6260, off late session highs of $1.6280. Thin trade conditions, with Japan and China missing today, saw rate track the initial pullback in EUR/USD, the rate posting overnight lows at $1.6257 before picking up fresh demand that lifted it through Friday’s high to extend the recent recovery to $1.6289. Rate retained a buoyant tone into the European open, aided by EUR/GBP extending 2012 lows to stg0.81295 in Asia. Middle eastern demand for cable was cited for the move on to $1.6298 but option linked supply ahead of a $1.6300 barrier countered. The move lower gained weight on reports of Asian sovereign sales, same name that was a noted seller in EUR/USD, but rate met support between $1.6280/70 before pressing toward reported stops sub $1.6265. Traders had mentioned in early Europe they would look to squeeze the weaker longs out by pressing rate below this level before looking to take it higher again. EUR/GBP squeezing to stg0.8124 took out a barrier at stg0.8125 and remains heavy into NY.
EasyForexNews Research Team