Forex Market
GBP/USD Analysis
Closed in NY at $1.5530, off sessions best recovery level of $1.5601. Rate had initially been driven higher by the no change decision by the BOE MPC for rates and QE, with risk also given a boost as China cut rates into the BOE announcement.
AUD/USD Analysis
AUD/USD managed to make a show back above parity during Thursday’s trade, the recovery boosted by the China rate cut as well as market positioning for a hint toward QE3 by the Fed’s Bernanke in hish NY morning testimony.
USD/JPY Analysis
A change of perception in Thursday’s China interest rate cut provided the main drive in Asian markets. Thursday’s initial risk-on react tone to the move, along with upbeat expectations that the Fed’s Bernanke would hint at QE3 in his testimony, had taken USD/JPY to highs in NY of Y79.80, EUR/JPY to Y100.63.
EUR/USD Analysis
Closed in NY at $1.2559, off a late pullback low of $1.2555 seen after Fed’s Bernanke disappointed markets by failing to hint at imminent QE3. Rate had seen a strong rally from $1.2540 to $1.2626 pre Bernanke on expectations, the risk-on rally also fuelled by the China rate cut.
Asia today: 3 in a row! Oz trade data better than consensus
For the third day in a row, Australia was in the spotlight during the Asia session. This time it was the turn of trade data for April. The trade balance came in at a deficit of A$203 mln, well below consensus estimates of a A$900 mln deficit and a sharp improvement on the revised A$1.282 […]
Technical Analysis: Short Cycle Report: The trend is your friend
The bounce in “risk” is a natural part of the bear market cycle but the overall trend remains down for stocks and up for the US Dollar. EUR-USD has resistance between 1.2589 and 1.2623 but a bounce as high as 1.2824 cannot be ruled out. The S&P 500 has resistance between 1334 and 1340. Bond […]
Ahead of the BOE rate and asset purchase
BOE: Ahead of the BOE rate and asset purchase facility decision on Thursday analyst expectations are below: * Citi expect no change in rate but extra Stg50bln in QE to Stg375bln.
EUR Analysis
Opened early Europe at $1.2565, EUR/USD closed in NY at $1.2570, off recovery highs of $1.2587 as risk was given a boost on market chatter of global stimulus plans. Rate initially squeezed down to $1.2565 before getting a fresh lift on release of stronger than forecast Australian employment data.
GBP Analysis
Opened early Europe at $1.5473, stg0.8120, GBP closed in NY at $1.5495, off a late recovery high of $1.5504 (NY high $1.5516). Rate continued its corrective pullback in early Asia, touching a session low of $1.5470 before picking up fresh demand.
JPY Analysis
Opened in early Europe at Y79.44 and Y99.85, USD/JPY edged up from early overnight session lows of Y79.19 to Y79.44 into early European dealing, as the underlying risk on tone, along with recent threats of yen intervention, continue to prompt an outflow from yen, though at a slow pace.
Bank of England will probably follow ECB’s lead and do nothing
As I pointed out on the 23rd May, the minutes of the last Bank of England’s (BOE) Monetary Policy Committee (MPC) meeting showed they had their collective ‘finger on the trigger’ to introduce more Quantitative Easing.
AUDCAD: a second chance for tardy bears
AUDCAD has ripped higher in sympathy with the crazy rally in markets on the hopes that central bank intervention will once again put a bid under risk assets. The Australian dollar is often one of the higher beta currencies to risk appetite among the major currencies, and the last several days of market action have […]