Forex Analysis

ECB viewpoint: Dovish Draghi delivers

As a follow-up on our initial thoughts on today’s ECB decision, here are a few more comments:

AUDCAD – correcting to .9744/41 within a bull flag

AUDCAD is forming a bull flag from the high at 1.0048 but the pullback is still incomplete and we expect it tomove lower towards a support zone between .9741/.9573.

USDCAD – completing sideways correction above 1.0398

The 1.0420/0400 zone still represents strong support for $cad and we expect prices to rally higher to continuethe uptrend that began from 1.0182.

EUR Mid-day Analysis

While consolidating this week’s rebound and finding near-term support at the key 135.00 level, the Euro has been reluctant to probe the upside in front of today’s European Central Bank meeting.

Since putting the brakes on its late October downdraft, the Swiss Franc has coiled in a tightening pricepattern over the past few sessions which may be setting the stage for a breakout move late this week.

JPY Mid-day Analysis

The continued erosion of safe-haven support has kept the Yen on the defensive late this week, even asJapanese equities have a tough time sustaining upside momentum.

USD Mid-day Analysis

A quiet overnight session has left the Dollar with mild strength, but still within the lower portion of itsweekly trading range as the market prepares for critical events both at home and abroad.

Morning FX Market Commentary

Dollar hardly profits from strong ISM On Tuesday, EUR/USD traded with a slightly negative bias. Traders were cautious on the euro ahead of the ECB.

Beware the squeeze – can’t get excited with ECB

We don’t think it is a big deal if the ECB cuts interest rates in December, or even today.Cash EONIA is already at 9bps, not rising to 25bps until January 2015.

The Global Macro Pulse

Overnight Price Action Most equity markets are down in Asia today. S&P futures are off 0.2%, the Nikkei has fallen 0.6%, the HSI is off 0.7%, Kospi is down 0.4%, and

FX Daily

Market movers today * We expect ECB to refrain from cutting rates in connection with today’s meeting but instead signal a rate cut in December.

GBP/USD Analysis

The pair closed in NY Wednesday at $1.6081, having seen data react highs of $1.6118 earlier in the session, post UK IP/Mfg data, before rate settled between $1.6075/95 into the close.