Consolidation ahead of NFP

<p>  EUR/USD Range: 1.2373-1.2378 Support: 1.2288 Resistance: 1.2525 So Mr Draghi delivers with the ECB lowering its official rate by 25 basis points taking the […]</p>



Range: 1.2373-1.2378
Support: 1.2288
Resistance: 1.2525

So Mr Draghi delivers with the ECB lowering its official rate by 25 basis points taking the ‘refi’ rate to 0.75% and the deposit rate from 0.25% to 0.00%! The ECB president sounded very much like the British summer with the main headline being ‘downside risk to growth’ all in all his tone to me was the ECB admitting the problem is here instead of a potential problem. Euro traded through the 1.2410 level with ease and has failed to rally above since as we await the US jobs report today with consensus being 100k with the unemployment rate remaining steady at 8.2% I expect focus on the June low of 1.2290.





Range: 1.5515 – 1.5537
Support: 1.5475
Resistance: 1.5600

The BoE announced a £50 billion expansion in its asset purchase programme, taking the stock asset purchases to £375 billion which is estimated to be about 25% of annual GDP. The MPC cited weak growth, both domestically and abroad and tight credit conditions from the Euro area. The announcement was exactly what the market had predicted. Today will be all about NFP with a small distraction in the way of UK input/output prices at 9.30am this morning.





Range: 1.0242-1.0292
Support: 1.0150
Resistance: 1.0350

The PBOC joined the stimulus party yesterday cutting 1-year lending rates by 31 basis-points to 6%, 1 year deposit rates by 25 basis points to 3% and slashing bank lending rates by 30%. The market is now predicting that next week’s Chinese growth data will be below expectations. The AUD performed remarkably well yesterday with investors piling into the lifestyle currency looking for yields with EUR/AUD breaking all time lows. Again all about NFP’s today but I’m still not ready to try and pick a top in the AUD yet despite overnight signs of fatigue.

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.