The old transatlantic friendship, often cited when the closer economic development and politics between America and Great Britain is discussed, seems not to work anymore between the currencies of these countries. Once linked to the dollar like a ball and chain, the British pound has changed into a maverick against the dollar ever since "Thatcherism" left the political stage. Yet another link seems to have established itself, the link to the euro, although Britains would probably never join the single currency. So far, this fact is admittedly not very inspiring. But what is really interesting in this new relationship is that cable has often proved to be a leading indicator for the dollar, i.e. the pound development vs. the USD leads the euro vs. USD, even in intraday trading, by about 2 to 3 hours. If that situation remains, we have two advantages for our daily trading activities. For one, there is a bellwether for the EUR / USD pair for riskier trades and, for the second, a smaller risk can be taken in the EUR / GBP equation by just selling or buying this pair during a sideways movement.
In today’s trading; Focus will be the waning confidence in the USD after the explicit announcement yesterday of the FOMC for "quantitative easing," i.e. printing money by buying up long-term bonds. But considering the fact that such action was known long before, by several speeches of the Fed’s chairman, the reaction of the market might be overdone. The beginning of the EU’s spring summit today with the objective to fight the economic slump will most certainly deliver more volatility today to the now very nervous market. We would therefore stand aside in today’s trading. Note some movement may come from today’s publication of U.S. Jobless Claims at 13:30 and U.S. Leading Indicators for February at 15:00 CET.
Intraday Market Outlook for Day Traders
EUR / USD
The mrket need soe time o digest yeterday’s jump in the EUR / USD. It is consolidating at higher levels in early European trading and is currently at 1.3480, with a support below at 1.3430. We expect a downward correction in today’s trading, breaking that support, to levels around 1.3350.
GBP / USD
Cable is in another upmove in European morning trading, attempting to break the highs of yesterday around 1.4320 and currently trading at 1.4295. We see that upmove slowly losing momentum today, resulting in a down correction as far as 1.4190, but only after testing the resistance at 1.4365.
USD / CHF
Even after the huge fall of the dollar yesterday against the Swiss franc, the selling mood continues in early European trading, with the market right now at 1.1400. We expect an upward reaction to set in soon today, recovering lost territory to the 1.1550 level.
USD / JPY
Yesterday’s distorted trading conditions in the dollar against the yen was stabilized in Asian trading, and the early European hours saw a slight recovery to now 95.70 after reaching a low around 95.20. We expect the recovery to gain momentum in today’s trading, up to resistance at 96.50.
In today’s trading; Focus will be the waning confidence in the USD after the explicit announcement yesterday of the FOMC for "quantitative easing," i.e. printing money by buying up long-term bonds. But considering the fact that such action was known long before, by several speeches of the Fed’s chairman, the reaction of the market might be overdone. The beginning of the EU’s spring summit today with the objective to fight the economic slump will most certainly deliver more volatility today to the now very nervous market. We would therefore stand aside in today’s trading. Note some movement may come from today’s publication of U.S. Jobless Claims at 13:30 and U.S. Leading Indicators for February at 15:00 CET.
Intraday Market Outlook for Day Traders
EUR / USD
The mrket need soe time o digest yeterday’s jump in the EUR / USD. It is consolidating at higher levels in early European trading and is currently at 1.3480, with a support below at 1.3430. We expect a downward correction in today’s trading, breaking that support, to levels around 1.3350.
GBP / USD
Cable is in another upmove in European morning trading, attempting to break the highs of yesterday around 1.4320 and currently trading at 1.4295. We see that upmove slowly losing momentum today, resulting in a down correction as far as 1.4190, but only after testing the resistance at 1.4365.
USD / CHF
Even after the huge fall of the dollar yesterday against the Swiss franc, the selling mood continues in early European trading, with the market right now at 1.1400. We expect an upward reaction to set in soon today, recovering lost territory to the 1.1550 level.
USD / JPY
Yesterday’s distorted trading conditions in the dollar against the yen was stabilized in Asian trading, and the early European hours saw a slight recovery to now 95.70 after reaching a low around 95.20. We expect the recovery to gain momentum in today’s trading, up to resistance at 96.50.
