Consolidation continues ahead of Bernanke
City Index August 30, 2012 2:30 PM
<p> EUR/USD Range: 1.2522-1.2561 Support: 1.2450 Resistance: 1.2450 The single currency opens in the middle of yesterday’s range of 1.2520-1.2570 at 1.2550 following an overnight […]</p>
The single currency opens in the middle of yesterday’s range of 1.2520-1.2570 at 1.2550 following an overnight opinion piece from ECB president Draghi where he states that the central bank need to ‘employ exceptional measures’. There were also positive euro comments from The Chinese premier Wen saying that ‘China will continue to invest in European debt’ added to this was an article in the WSJ from Angela Merkel where she states ‘eurozone has political will to revive confidence in the Euro’. I continue to trade the range 1.2450-1.2600 until the Jackson Hole tomorrow with a slight emphasis to fade a rally as I believe Bernanke will disappoint.
Range: 1.5819 – 1.5843
Sterling trades with a bid tone as we head towards the business end of the week and the month end rebalancing flow. The July consumer credit data and the mortgage lending data will be released today with the consensus being for £0.3 billion for the credit data with mortgage approvals expected to show a stronger number of 46k.The price action is constructive for the pound but with month end rebalancing expected in the EUR/GBP I’ll be cautiously looking to fade a cable move to 1.5900.
The AUD traded lower overnight but holding support at the 200-day moving average at 1.0312 as EUR/AUD touched 1.2150. The catalyst for the move seems to be soft commodity prices with iron ore falling further overnight along with weaker mining stocks and disappointing building approvals that declined to -17.3% from -5%.
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.