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EUR/USD Bids Begin to Emerge

EUR
MNI (London)
  • Monday's continued USD correction saw EUR/USD pressed to an extended pullback low(off Jan06 high of $1.2349) of $1.2132, holding just shy of the Dec21 low of $1.2130.
  • Rate managed to recover to $1.2174 through the 1600GMT fix before it drifted off to $1.2149 into the close.
  • Early demand in Asia saw rate nudge to $1.2162 before it dropped back, the move meeting support around the $1.2140 level. Rate has edged back to $1.2155 ahead of Europe.
  • Asian traders suggest leveraged demand interest below market between $1.2130/25.
  • Reading through reports this morning and there seems to be a suggestion that the USD correction may have run its course with USD shorts moving back into vogue.
  • Resistance seen into $1.2180 ahead of $1.2200.
  • Option expiries of note seen at $1.2150(E1.1bln-EUR puts), $1.2200(E1.4bln-EUR puts), $1.2250(E1.4bln-EUR puts), $1.2300(E2.1bln-mainly EUR puts).
  • A light EZ data calendar Tuesday. ECB de Cos speaks at 1720GMT.
  • Fed speakers include Brainard (dove) 1435GMT, Rosengren (NV, hawk), Kashkari(NV, dove), Kaplan(NV, no bias) at 1600GMT. Fed George(NV, hawk) at 1800GMT and Rosengren again at 1900GMT.
  • MNI Techs: Pair started the week on a softer note, extending the pullback from last week's 1.2349, Jan 6 high. Price action has traded through the 20-day EMA and this exposes support at 1.2130, the Dec 21 low. A breach here would open the 50-day EMA at 1.2085. Momentum studies have recently signalled an overbought condition. The current pullback is being seen as a much needed correction. 1.2230 is initial resistance.
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets

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