EURJPY: Support at 128.80/129.00, resistance at 128.20/127.40

The euro was boosted yesterday afternoon as news began to filter through that the talks between Greece and the Eurozone were working through the proposals, although deal may not be done by Friday’s Eurogroup meeting. At least some progress is being made. This resulted in a reversal of the earlier dollar strength. Equity markets seem to be moving almost on individual earnings stories in the US and as a result there was very little overall direction, with the S&P500 down 0.2%. Asian markets were reasonably positive overnight, with the Nikkei 225 up 1.0% after Japan posted a trade surplus showing that the weaker yen is helping the country’s exporters. European markets are mixed to slightly stronger in the early moves today.
Forex trading shows more of a consolidation on the dollar has formed after yesterday’s fluctuations. The main mover is the Aussie dollar which has strengthened by around three quarters of a percent in the wake of Australian inflation data which came in line with expectations on the month and showed a 1.3% change on the year. Gold and silver are showing little signs of any real move, whilst oil prices have started to fall back after the announcement that Saudi Arabia had ended its campaign of air strikes on Yemen.
Traders will be watching out for the Bank of England meeting minutes today at 0930BST. The expectation is for another unanimous decision to keep rates steady, but interest will come in any signs of potentially hawkish moves on the committee. The Eurozone consumer confidence is at 1500BST and is expected to improve very slightly to -3 from -4. Also at 1500BST is the US existing home sales, which are expected to improve to 5.04m (from 4.88m last month). Dollar bulls will hope that the housing data can show signs of an improvement after disappointing building permits and housing starts last week.