Littlefish FX | May 07, 2015 05:03AM ET
KEY DATA RELEASES TODAY (BST) :
09:30 GBP Parliamentary Elections
13:30 USD Unemployment Claims 277K v 262K
OVERNIGHT:
EUR/USD rallied to a two-month high of 1.1370, continuing to pull away from a 12-year trough of 1.0456 plumbed in March. Market believes the euros resilience is mainly due to an swelling in Bund yields, which have jumped nearly 50 basis points in just a week as the European QE trade which was very crowded (Long Dax, Long Bund, Short Euro) has been somewhat unwound.
GBP/USD was given a small boost by a better-than-expected survey of purchasing managers in Britain’s dominant services sector in European session sterling bid against USD after the miss in ADP but shed one percent against a broadly stronger euro, hitting a three-month low before the national elections today.
USD/JPY tumbled to day low after an economic report showed that US private sector added fewer jobs than expected in April. Japan’s 10-Year bond yield rose 7 bps, the biggest increase in three months. JPY crosses quiet, mostly bid, big players still on holiday, looks like we will head into the NFP’s mid range making it harder for players to position into the data so most will be in wait and see mode.
USD/CAD weakened as crude prices surged to 2015 highs while the US dollar fell on soft economic data. Oil’s move appeared to overshadow any market reaction from an historic election in the oil-producing province of Alberta, in which the left-wing New Democrats won a crushing victory,ending the Progressive Conservatives’ 44-year hold on power.
PRICE ACTION OVERVIEW:
EUR: Testing 1.1350 offers as anticipated expect bids at a retest of 1.1250 intraday, only below 1.1150 concerns immediate bullish bias
GBP: While 1.5050 supports the advance expect a retest and break of 1.55 en route to 1.5560
JPY: Rejected at the 120 descending trendline, now mid range as price contracts to the apex of the triangle
CAD: Bids at 120 continue to support on a closing basis, while this level survives anticipate a retest of 123/24 from below
AUD: Offers at .8050 reject on the first attempt while .78 supports potential for another run at .8050
KEY TRADES:
FX Pair | Short Term | Position/Date | Entry Level | Target | Stop | Comments |
EUR/USD | Bullish | Await new signal | ||||
GBP/USD | Neutral | Await new signal | ||||
USD/JPY | Neutral | Await new signal | ||||
USD/CAD | Neutral | Buy/May 7 | 1.2090 | Open | 1.1990 | |
AUD/USD | Neutral | Sell/May 7 | .7930 | Open | .8030 |
ANALYSIS:
EUR/USD Short Term (1-3 Days): Bullish – Medium Term (1-3 Weeks) Bearish
GBP/USD: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks) Bearish
USD/JPY: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks) Bullish
USD/CAD: Short Term (1-3 Days): Bearish – Medium Term (1-3 Weeks) Bullish
AUD/USD: Short Term (1-3 Days): Neutral – Medium Term (1-3 Weeks) Bearish
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.