Risk trades positive following stronger US jobs data
City Index August 6, 2012 1:00 PM
<p> EUR/USD Range: 1.2350-1.2444 Support: 1.2300 Resistance: 1.2450 The risk rally seen on Friday following robust US jobs data continued in the early Asian […]</p>
The risk rally seen on Friday following robust US jobs data continued in the early Asian session, with the single currency taking out stops above 1.2400 but falling just shy of the 1.2450 level. The weekend press seemed to be supportive of Draghi’s ECB press conference last week, signalling that the ECB is ready to act as soon as Spain and Italy ask for assistance. All eyes will remain on peripheral spreads this week with little data to inspire the market.
Range: 1.5602 – 1.5668
Focus remains on Italy and Spain this week after a stronger US jobs report inspired a risk rally on Friday. The highlight for the Queen’s currency this week will be the release of industrial and manufacturing data tomorrow, with the BoE inflation report released on Wednesday. Sterling is trading at the hands on EUR/GBP at the moment, with resistance seen at 0.7950-0.7970 and then the all-important 0.8000.
USD/JPY traded higher on Friday following a stronger non-farm payroll reading but even the robust data couldn’t inspire a sustained rally as local exporters continue to cap any move towards 79.00. The BoJ meeting this week is likely to bring a tweak to its asset purchase programme to ensure it remains on track to meet existing targets of JPY 65 trillion (14% of GDP) at the end of 2012 and JPY 70 trillion (15% of GDP) by mid-2013.