Rate squeezed lower from its opening high of $1.6346 in Asia

<p>GBP/USD Range: 1.6281 – 1.6343 Support: 1.6250 Resistance: 1.6400 Rate squeezed lower from its opening high of $1.6346 in Asia, the move lower led by […]</p>

GBPUSD
GBP/USD
Range: 1.6281 – 1.6343
Support: 1.6250
Resistance: 1.6400
Rate squeezed lower from its opening high of $1.6346 in Asia, the move lower led by yen crosses as market moved into risk aversion mode. Sterling-yen traded sharply down from Y138.60 to Y136.00, taking cable to session lows of $1.6280 with recovery efforts so far remaining very shallow, cable currently trading around $1.6290, while sterling-yen trades at Y136.70. Focus turns to UK inflation data at 0830GMT with most expecting headline y/y inflation to come in at 4.4%. Traders note that cable often gets a pre release push higher but usually gives back gains after release, whether it comes in stronger than expected or not (a few traders suggesting the best vehicle to trade is sterling-yen as seen as most reactive).
EURUSD
EUR/USD
Range: 1.4376 – 1.4441
Support: 1.4330
Resistance: 1.4500
Rate initially edged back to mark session highs in Asia at $1.44416 before stalling with market reversing tack to a risk off tone as the situation at the Fukushima plant was moved up to a 7 severity level, the highest on the scale and same as Cherbonyl. This move to risk aversion pressured euro lower via cross sales, euro-yen dropping back from Y122.41 to Y120.16, while euro-Swiss broke down from Chf1.3096 to Chf1.2970. These sales took euro-dollar through the NY base with triggered stops below $1.4420 providing the added momentum to take rate below $1.4400 to $1.43761. Bounce back in the crosses allowed rate to recover to $1.4405/10, with rate currently pivoting $1.4400 into early Europe (release of as expected German CPI having little effect). Asian currencies weakened on profit take sales overnight with no Asian central bank interventions recorded in the moves.
Precious Metals

 

Gold and silver prices surged to new highs, supported by safe-haven demand, before a drop in risk demand and an easing in oil prices helped undermine bullion prices. The slide in oil prices may have been prompted by talks between the two sides in the Libyan civil war. Gold losses were limited as Fed officials cautioned against an abrupt change in monetary policy. Silver prices moved to near USD42/oz before shedding the bulk of gains by the end of the trading session. Interesting to us, the German government is reviewing its program for issuing silver coins in light of the high prices, according to the Finance Ministry.

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