EUR – Never wanted to rally yesterday in the face of strong corp demand in the morning and once we took out gd bids around 1.3050 we never looked back – RM and lev supply helped push us to the low at 1.2985. We now have that close below the moving avg at 1.3070/90 area (50/100/200) so looking at that area to cap us intially topside support is that 1.2980/00 area still which contains the top of the daily cloud. Look to sell 1.3050-70 stop in short term 1.3120.
GBPUSD – Touched as low as 1.5298 in NY trading, and has underperformed in the last 24h, with EURGBP continuing to bounce from .8469 support. The markets appetite to sell GBP is beginning to resurface. Macro accounts have been active on both sides of the market this week, but they certainly seem to be trading around a bearish bias. I am square at current levels, but would willingly fade any strength into the 1.5380 – 1.5400 band. Resistance should be found in that area, followed by more selling around yesterdays 1.5440 high. Downside objectives are located at 1.5274 (4.6 low) and 1.5169 (3.6 low).
EURGBP – Has gyrated with a series of large trades this week. Real Money clients have shown an interest to sell, whilst the suggestion is some significant Corporate demand has also been noted. In any event, .8469 has proved very good support, and should continue to do so. A close below, would open losses towards the .8421 region. I am square right now, but have a general preference for selling a rally, and would identify .8520 – .8550 as a fair entry region.
JPY – Still stuck chopping around on this 97 handle – Threatening to push higher this morning with the Nikkei up 3% , however expect exporter supply lies 98.30/50 area ahead of that previous high at 98.72 – Downside support in short term is 97.60 then that 97.20 area below – topside need a clean break above 98.70 to confirm a move out of range. Generally feels like usdjpy will attempt a push higher – long from here this morning – will look to add at 97.70 looking for 98.70 again.
CHF – With eurusd coming off usdchf has been underpinned and eurchf bounce off the 1.2215 (200 day) has consolidated this move – we are into the recent top of range now at 0.9450/0.9500 so expect some offers 80/00 above initially – support is 0.9370 then 0.9320 – i remain long will add on the day at 0.9390.
AUD & NZD – Topside levels broken in both AUD/USD and NZD/USD as stops are triggered and EUR crosses get hit hard. EUR/AUD took another hit as we as we retrace nearly 5 figures from the highs over the last 5 sessions. 1.3810 support could locked onto as volumes increase on the down move so far. For AUD/USD, we’ve blown through range highs and taken out 0.9326 tech resistance in the process. Price action remains loose and choppy and I stand aside unless we get close to 0.9400, my preferred entry level to try new shorts again. Similar sentiment in the Kiwi will get me fading into a 0.7940 bounce. Powder dry and keep out of trouble until levels get close.
CAD – cleared stops overnight back through 1.0450 as the market digests the disappointing US Q1 GDP print. This came despite some good macro demand 1.0460-80 post-number. 1.0380 remains the key level to the downside and the April GDP print due from Canada tomorrow should take on added significance (cf +0.1%). Focus today likely to be on speeches from Dudley and Lockhart, after Lacker yesterday stated his lack of surprise at the GDP revision. Have picked up some demand overnight 1.0390-1.0410 as some corp. names start to raise their bids, previously seen 1.0150-1.02.
Scandies – started to see the first signs of RM re-entering NOK longs after a strong Norwegian unemployment print (3.5% vs. cf. 3.7%) in the 7.92-7.94 region. Combined with some USD/NOK supply through 6.09-6.07, feels like good stops in EUR/NOK through 7.88 could come under pressure at some point today. This was the first level post Norges Bank that the market settled and levels at which we saw leverage accounts add to their spec. longs. Swedish trade balance data out at 08:30LDN and feels like EUR/SEK has some more room to the downside back towards support 8.69/8.71, with EUR/NOK looking well resisted against 7.95, but market very sensitive to domestic data at the moment and seems to be a battle of wits in NOK/SEK as RM demand keeps the cross well supported for now against 1.0980/1.10.
Barclays