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Market Session Recaps

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London Session

Wed, Jan 7 2009, 06:10 GMT
by Forex.com Research Desk

FOREX.com


It was a dose of deja vu in the London session as, much like yesterday, the euro was pummeled. The big number out of the eurozone was the consumer price estimate for December and it came in below expectations at 1.6%, and is a sharp decline from the 2.1% run-rate in November. This leaves the door wide open for the ECB to cut rates in size later this month as the inflation argument continues to become less compelling.

EUR/USD was crushed more than -150 points in London trading and was sitting near the session lows by 1.3310/20 just ahead of the NY open. Expect accelerated weakness here if we get below the 1.3250 level. EUR/JPY was likewise lower and the pair slipped more than -70 pips towards the 1.2520/30 zone.

Crude oil prices continued their upward climb and broke decisively above $50/bbl resistance. This helped fuel another dip in USD/CAD, which shed about -80 pips to the 1.1890 level.
Geopolitical tensions remain the primary driver here and we would not be surprised to see oil prices come off sharply once this subsides. For now, the 1.1820 mark in Loonie is critical support.

Upcoming Economic Data Releases (NY Session) previous forecast

  • 1/6 13:30 GMT CA Industrial Product Price MoM NOV 0.00% -1.00%

  • 1/6 13:30 GMT CA Raw Materials Price Index MoM NOV -12.50% -9.00%

  • 1/6 15:00 GMT US ISM Non-Manf. Composite DEC 37.3 37

  • 1/6 15:00 GMT US Factory Orders NOV -5.10% -2.20%

  • 1/6 15:00 GMT US Pending Home Sales MoM NOV -0.70% -1.00%

  • 1/6 19:00 GMT US Minutes of Dec. 16 FOMC Meeting 6-Jan

Published on  Wed, Jan 7 2009, 06:12 GMT


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