Forex Market
FX Daily Strategist: Europe
* EUR Short covering remains the big driver The big driver in FX continues to be short covering of EUR positions on anticipation of a strong ECB response to lower sovereign debt yields; yesterday’s news that ECB Draghi won’t be attending the Jackson Hole conference on account of a busy schedule play to this.
European FX Daily
* Majors pared gains, Asian markets mixed * Korea’s current account surplus hit record in July * Norges bank likely on hold, Brazil central bank likely to deliver rate cuts
FX Daily Majors
Today’s highlights: * EURUSD: Rebound brings the market back up towards the 1.2593/8 resistance hurdle. Whilst below here the bias remains lower for 1.2431, then 1.2337
Technical Analysis
The euro got a boost and the krona gives back gains… EUR/USD High session close points up… EUR/SEK Downside potential questioned… GBP/USD Trendline support confirmed… USD/SEK Focus back at upside in wedge…
FX Market Technical Research
EUR/USD: Bulls Eye 100-Day Moving Average. The pair holds above the former 61.8% retracement level, which had capped at $1.2444, with this level now turning support.
USD/JPY Analysis
Closed in NY at Y78.50 having recovered of pullback lows of Y78.45. Dollar-yen opened in Asia at Y78.52 and lifted ahead of the Tokyo fix on Japanese name demand, reserve manager supply kept the rate in check and trade was largely rangebound, Y78.50 – Y78.63.
GBP/USD Analysis
Closed in NY at $1.5819 after pulling back from a fix driven high of $1.5837. Early trade in Asia was restricted to a tight $1.5814/21 range, with a mid session push up to $1.5823 meeting sellers which pressed it back to retest the early lows before settling between $1.5814/19 through to the European open.
EUR/USD Analysis
Closed in NY at $1.2564, following a lacklustre NY session which had seen rate consolidate mainly between $1.2555/70 (NY range $1.2536/77), after rate had recovered off earlier Asian lows of $1.2466.
Global Technical Watch – Quick Charts (Aug 29)
The lower break in the Shanghai Composite last week is having a bearish ripple effect across Asian currencies. On the TRENDS Heatmap, underperformance of EM Asian and the AUD, NZD are standouts.
Asian Currencies Technicals
AUD/USD: Chopping around lower Bollinger band. The AUD/USD continues to chop around the falling lower 21 day Bollinger band as it heads towards the initial target at the 200 day moving average.
Euro re-squeezed ahead of Friday’s main event
The positioning squeeze on stale short Euro and long Aussie trades continues as the markets mull how much QE3 is priced in and what Bernanke may or may not hint at this Friday.
Americas FX Daily
EUR crosses resume move higher What happened overnight * Euro area M3 data shows deposits pick up in Italy, Greece and Ireland * South Africa Q2 GDP in line with expectations at 3.2%qoq * Fonterra cut 2013 forecast payout for New Zealand dairy farmers