EUR – Interesting to see that eurusd hasn’t been dominated by eurjpy o/n and has taken out stops higher back above that 1.3335/40 lvl trading to 1.33715 currently. Right now still some offers here 1.3370/90 but topside at 1.3400/05 interesting to see that stops increasing , while selling reduces. 1.3335/40 now short term support then that 1.3300 topside 1.3400 – still looking ultimately for a break at 1.34 on way to a new high towards 1.3475/80.
GBP – Public finances at 9:30 (definitely today), CBI trends at 11:00. Sterling has shown little sign of any pullback over the last few sessions and continues to weaken. EUR/GBP now takes another leg higher, breaking up through 0.8400-10 and setting its sights on 0.8506 target. Cable may take a small breather as it gets caught up with a bid EUR/USD but offers ahead of 1.3400 there may ruin even that chance of relief. 1.5863, 1.5883 and 1.5900 resistance with 1.5830, 1.5806, (o/n low) and 1.5780 support. EUR/GBP support at 0.8410, 0.8378 and 0.8355. On the topside, there isn’t a lot on the techs until 0.8485, with 0.8506 the 2012 high.
JPY – Price action post BOJ suggests some profit taking after the failure to make new highs above 90.25 (yesterdays high) leads to a stop sell off back below 89.50 to 88.89 low. The BOJ adopts the 2% inflation target and states it moves to open ended purchases – Key commentary for me is the that headlines – BOJ GOV SHIRAKAWA: BOJ STRENGTHENED ITS TIES WITH GOVT TO ENSURE EARLY ESCAPE FROM DEFLATION and CORRECTED-JAPAN PM ABE: BOJ HAS UNDERSTOOD GOVT THINKING ON MONETARY POLICY – The Government want a weaker JPY , and the BOJ understand this and will act accordingly. 88.50/88.80 key support downside and i expect this to hold looking at 89.50/60 as pivot for a further squeeze back higher.
AUD/NZD – saw a decent spike higher in Asia on no apparent news flow, really did look like a one-off flow went through with both currency pairs still holding up for now. 1.0600 remains the first level above in AUD, 0.8440 for the mighty bird. In keeping with recent ranges I have sold NZDUSD on this spike with a chop through 0.8440. We still have interest to buy EURAUD on dips from here, 1.2640 the first such level. AUDNZD still trapped in this 1.2520-1.2600 range, trade it until broken. AU CPI this evening the domestic catalyst to monitor.
CAD – US out yesterday and as such really not a lot to be said from the session, saw some RM supply around 0.9930 yesterday and happy to be short USDCAD myself with a stop above Fridays high around 0.9950. We have drifted lower overnight in line with some general demand for risk but no standout flow of note. As one would expect CADJPY a bit whippy overnight but as has been the case for the past week or so only one leg at the races! Few stops popping up below 89.40 and then bids around 89.00 in CADJPY but downside still feels a little vulnerable. Wary of EURUSD breaking up above 1.3410 and dragging EURCAD with it which remains bid above 1.3230 and technically looks good to 1.3350 now but hanging onto CAD longs for now. Resistance 0.9950 1.0000 1.0030. Support 0.9900 0.9880 0.9830.
Scandies – We took out stops yesterday in EURSEK on break of 8.70 with some local RM and leverage demand pushing us to just shy of 8.72 where we have since drifted off and now look set to test the 200 dma around 8.6425 before I would look to re buy it. Sitting long some NOKSEK which couldn’t sustain a move above 1.1680/1.17 yesterday but so far holds in above 1.1610/00 support. EURNOK has got offers building around 7.48/50 and think this initially should be tricky to overcome however NOKSEK breaking out of this 1.16/17 range may be the catalyst. No data of any note until Thursday. EURSEK support: 8.64 8.59 8.55 resistance 8.72 8.75 8.80. EURNOK support: 7.43 7.38 7.32 resistance: 7.48 7.50 7.53.
Barclays Capital