A turkey of an FX market just in time for Thanksgiving
Another quiet Asian session ahead of today’s US Thanksgiving holiday has meant that volumes and general business flow have been significantly diminished, which in turn has meant that whatever moves we’ve seen so far have been further exaggerated. To give you an understanding of how thin it is, an order/deal in the size of around 20 million EURUSD is enough to move/scare the market to the tune of 10 points at the moment. Headlines when and if they hit, certainly don’t help the picture.
This afternoon sees no real data releases for obvious reasons and thus you can safely expect a quiet session. Tomorrow is not likely to be a great deal better as most Americans will be taking a long weekend. Overall however I like a slightly softer USD for now. The Cable is now set to retest this year’s highs at 1.6381, and wouldn’t it just be perfect if that’s where we ended the year. Given that the high was traded on January 2nd this year, we would’ve come full circle just to end up in the same spot…
In terms of the EURUSD, begrudgingly the cross heads to 1.3630/50 where it provides far better risk reward for shorts, however the downside won’t see us much below 1.3450/30. The way in which this picture develops however is almost anyone’s guess at the moment.
The AUDUSD has begun its bottoming out process and while sellers still dominate, their enthusiasm seems to be waning. I still look for 0.9030/50 as the mark. The only proviso to this would be barriers at 0.9000 which could prove magnetic for quick drive by’s before a resumption higher.
Elsewhere the picture is muddy and anything but obvious. As yearend draws upon us, those that have made money look to protect it, while those that haven’t might still want to chase the market, not unlike a dog chasing its own tail…
In the meantime, as always, helmets on.