FX just keeps rolling with the punches, and headlines…
Another quiet overnight session is Asia as the market looks to start winding up the year. Equity indices continue to bubble along doing their own thing while currencies seem sidelined for the time being looking for that next magic oracle to announce and/or renounce negative rates, more easy money etc etc. Whatever moves we saw on the back of the Iranian deal (personally I didn’t really see anything of note myself) have now subsequently been reversed and it’s as though yesterday never actually happened. Suits me perfectly as I’ve rarely been one to enjoy Mondays myself.
On the day we’ve got little by way of data in the European session, save for Carney of the BoE being sat in front of the panel select committee answering questions in relation to last week’s inflation report. In the US this afternoon however, we’ve got housing data, Case-Schiller index prints and consumer confidence. Interestingly (albeit for now only) the market seems to have discarded the notion of a taper, in terms of trading the market with that in the rear view mirror at all times. The last few prints of data have had less of a taper on/off feel to them and with December almost here and the FED meeting not far either, all seems to have gone quiet on that particular discussion…
As far as levels on the day and what to expect… Range trading for the most part unless of course we get some interesting sound bites….
EURUSD: I still like it higher and while few would agree, that doesn’t leave me any less convinced that the squeeze could well still happen. Whether it’s today however, is an entirely different matter. Topside has sellers (all filled already) into 1.3550/70, with stops above 1.3580 and more interest to lose some EURUSD into 1.3630. Middle Eastern names have been buyers this morning taking us to current levels. On the downside 1.3530 is the most immediate line in the sand with some dip buyers sighted into 1.3510.
GBPUSD: With the panel select committee hearing due this morning you could almost toss a coin in Cable. However for choice, I like it higher and while sellers have kept it capped at 1.6190/95 this morning, stops are seen above 1.6210 and more offers into 1.6230. On the downside some hint (although I’m not sure) of stops sub the 1.6140/35 area.
AUDUSD: The little battler still wants to run lower but the understandable move back has seen us trade into the 0.9200 handle overnight where sellers joined the party and kept it well under control. The 0.9230 level is the most obvious and immediate area of resistance and stops above. On the downside I’m now hearing of fast money stops sat into/under the 0.9120 area.
Helmets on and good luck out there.