Today's market was driven mostly by news that kept both the Euro and the British Pound under pressure for the majority of the day. The first article was out of the UK and stated that a member of the Bank of England's monetary policy committee was set to boost the funds heading to their quantitative easing program next month.
GBP/USD opened the week lower by almost 40 pips near1.6320, shot to 1.6370 levels and then dropped off to bottoms near 1.6280. EUR/GBP opened near 0.9130 and subsequently dropped to 0.9100 lows for the day.
The Euro moves were pushed along by another news article stating that the current Euro strength was ''worrisome'', and that the two day Euro Zone Finance Ministers meeting that begins today may address that issue. Sixteen Euro Zone finance ministers will spend today and tomorrow in Luxembourg where a topic of concern will be if the strength of the Euro may dampen the region's economic recovery. EUR/USD touched 1.4920 early but then was put under pressure on its way to lows near the 1.4830 level. The pair did bounce however, and was closer to 1.4890 by session's end. EUR/GBP opened near 0.9130 and subsequently dropped to 0.9100 lows for the day.
Profit taking also played its part in today's action, as traders pared their positions in the Aussie and Kiwi dollars as well as other high yielders due to Friday's poor earnings and equity performance in the US on Friday. AUD/USD slid to 0.9115 levels before sentiment turned and traders began snapping up the Aussie at bargain levels. The pair pushed thorough 0.9190 late in the day, well off Friday's high almost a full big figure higher. NZD/USD was able to gain almost a full handle as it cruised from 0.7370 to 0.7465 over the course of the day. The Yen was mostly stable for the day.
All ears will be open for comments out of the current Euro Zone Ministers meeting over the next two days. Traders should tread with caution because we already are hearing comments from the pending meeting before it's even begun.
