EUR/USD
EURophoric sentiment dominated the session, as market participants adjusted risk premia after Moody’s affirmed Spanish sovereign rating. In turn this prompted aggressive tightening in both credit and bond markets, with SP 10s -32bps. Short-covering, as well as touted buying from an Asian central bank saw EUR/USD trade above 1.3100 level, while gamma remained better bid a result. In terms of technical levels, supports are seen at 1.3054/15 and then at 1.2993. On the other hand, resistance levels are seen at 1.3173/81 and then at 1.3242.
GBP/USD
The pair was supported throughout the session by broad based risk on sentiment, as well as the release of rather “hawkish” minutes from the BoE and an encouraging jobs report from the UK. The minutes revealed degree of hesitation among the MPC to boost the APF and there is growing uncertainty as to how effective another round of purchases will prove. In terms of technical levels, supports are seen at the 10DMA line at 1.6080 and then at the 21DMA lower Bollinger level at 1.5983. On the other hand, resistance levels are seen at the 21DMA upper Bollinger level at 1.6282 and then at 1.6310.
USD/JPY
The pair settled the session in minor negative territory as the USD came under renewed pressure as market participants reacted to the decision by Moody’s to affirm Spanish sovereign debt rating which in turn prompted broad based EUR strength. In terms of technical levels, supports are seen at 78.62/30 and then at 77.95. On the other hand, resistance levels are seen at 79.22/38 and then at 79.53.
