Forex Market

MAJORS FX: The euro index was last month hanging on the ropes but was saved by the bell from being downed below an important “B-wave low” at 103.54 against its index. Below would have (and still will) target levels below the 2010 low.

What happened overnight – Euro area manufacturing PMI revised lower – German unemployment rises – Greek cabinet approves plan for referendum – EFSF delays bond issuance plan – Australian building approvals weaker than expected

NOK/SEK to stay range-bound Following our recent two week European and Asian road show, we are convinced many investors still regard the SEK as vulnerable in the present environment of slowing growth.

At a glance: The risk-off trade is extending today as Greek news once again takes the air out of the positive sentiment. The impulsive, trending bias to the reversal highlights the short term risks of further retracement to the October trends as momentum extremes still need to be unwound.

– Greek call for a referendum hurts risk appetite and strengthens the USD – RBA cuts 25bp as expected – October China PMI fell 0.8pts to 50.4 – US ISM likely to edge higher, other G10 PMIs a tad softer – UK GDP growth likely to rebound but stay weak – We recommended shorting USDJPY […]