Closed in NY at $1.2851 after rate had eased off extended highs of $1.2872 to $1.2845. Rate had a quiet start into Asian trade with rate holding just above $1.2850. A US name made it known that they had decent demand at $1.2845, the rate dipped to $1.28465 before bouncing back, meeting resistance from offers placed ahead of Tuesday’s high at $1.2872 (initial high $1.2869) before it eased off to $1.2858. Wire headlines that Spain’s Rajoy was considering asking for help from ECB bond buying programme (story carried in Finnish press) provided the spark to lift the rate on to $1.2883. Enthusiasm quickly faded with rate drifting off to $1.2870 into early Europe. Market again seems to want to react to euro positive headlines (story on Rajoy wasn’t as supportive as headline suggested) with early focus on the German Constitutional Court verdict on ESM. Positive verdict expected but possible conditionality may effect. Option linked offers $1.2890/00. Barrier $1.2950, large stops above. Bids $1.2845/40, $1.2820, stops from short term accounts on break of $1.2800.
EasyForexNews Research Team