Recovery As Oversold Markets Bounce
Easy Forex | May 08, 2012 04:24AM ET
The markets were under pressure during the Asian session yesterday but the European traders took the weekend election news more positively and we saw a short covering rally back to Friday levels on most pairs. Stocks in the US were almost positive by the end of the session as March consumer credit soared 22.4bn on increasing student and car loans. Looking ahead, May IBD Economic Optimism Indicator previously at 49.3.
EUR
GBP
The GBP/USD was stronger than most even throughout the stock plunge on Friday and was able to retest 1.6200. The EUR/GBP is hovering near 0.8060 and is in striking distance of the 0.8000 in coming sessions if more euro negativity enters the market. Looking ahead, ECB President Draghi speaks.
JPYThe USD/JPY is being very quiet just under Y80 with risk aversion early in Asia reversed later on but not affecting the major only the crosses. GBP/JPY and EUR/JPY are both well positioned to bounce if things improve.
AUDThe range break to the downside was in danger of reversing yesterday with the market rallying from 1.0120 to 1.0220 in the European/US session. The outlook is for more negative but there is expected to be two-way action on most days even if we enter a downtrend. Looking ahead, March Trade Balance forecast at -1400mn vs. -480mn previously.
Oil & Gold (XAU) The XAU/USD was the in a tight range between $1640 and $1635 for most of the day waiting for inspiration. OIL/USD bounced to 98.20 as the selling subsided and bargain hunters entered the market after a two day $8 a barrel selloff.
h3 Pairs To Watch/h3EUR/USD showing resilience back above 1.3000
AUD/USD shorts squeezed?
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