As has been the cycle of one day optimistic, the next day pessimistic, today the optimism over yesterday's China bailout was replaced with pessimism over today's news about Circuit City's bankruptcy, AIG's further bailout, and the big 3 US automakers on the brink of collapse. As has been the case in these situations, risk aversion was back, and EUR/JPY was sold early to a 123.80 low, a dramatic slide from its earlier 128.42 high in early NY trading. With the Yen benefiting across the board in the crosses, we also saw the Dollar gain ground versus the Euro as investors looked for safety. USD/JPY reversed early losses near 97.50 and topped out at 98.28 before settling down close to 98.00. The USD/JPY range has been caught between 96.00-100.00 over the past few weeks. USD/CHF got a boost from risk aversion and saw a high of 1.1835, a level not visited in over a year. Talk of large offers above 1.1850 should help to impede the upside of this pair.
Meanwhile, EUR/USD hit a 126.74 low before gaining 50 pips prior to the London open. Those levels can surely be revisited if the German and ECB ZEW data is worse than expected later on.
Upcoming Economic Data Releases (London Session):
- 11/11/2008 9:30 UK Visible Trade Balance GBP/Mn SEP -£8198 -£8000
- 11/11/2008 9:30 UK Trade Balance Non EU GBP/Mn SEP -£5165 -£4950
- 11/11/2008 9:30 UK Total Trade Balance (GBP/Mln) SEP -£4737 -£4700
- 11/11/2008 9:30 UK DCLG UK House Prices (YoY) SEP -3.40% -5.40
- 11/11/2008 10:00 GE ZEW Survey (Econ. Sentiment) NOV -63 -63
- 11/11/2008 10:00 GE Zew Survey (Current Situation) NOV -35.9 -45
- 11/11/2008 10:00 EC ZEW Survey (Econ. Sentiment) NOV -62.7 -60.5
