Forex trading headlines from the European morning session 20 May
News:
- ECB weighing up a 6 week meeting schedule for setting policy – Bloomberg
- UK’s Cameron says the BOE has tools to curb housing boom
- Abe’s LDP party wants to speed up reforms for Japan’s largest pension fund
- ECB bank supervisor will be robust and effective say Nouy
- EU names and shames alleged cartel of Euribor rigging
- Forex probe shows clear attempts to manipulate prices says Germany’s BaFin
- PBOC needs to be more flexible in monetary policy
Data:
- April UK CPI 1.8% vs 1.7% exp y/y
- UK PPI input prices April m/m nsa -1.1% vs -0.2% exp
- German producer prices April m/m -0.1% vs 0.0% exp
- Italian industrial orders March m/m sa +1.3% vs -3.2 prev
- Nikkei closes up 0.49% at 14,075.25
- Shanghai Composite Index closes up 0.15% at 2008.12
It’s been another strange morning in the fickle world of forex in which we’ve seen the aussie $ fall again, the pound rally then fall just as fast, and the euro still looking like the uninvited guest at the party.
AUDUSD had been leading aussie pairs with its drop in Asia and we saw that continue with early session falls to 0.9293 from 0.9312 then triggering stops through 0.9285 to post lows of 0.9259 just above good support at 0.9255.
The pound meanwhile had been building up a little head of steam going into UK CPI with EURGBP the target of attack down to lows of 0.8125 not seen since Jan last year. Cable didn’t need any excuse to head higher but found resistance again 1.6845 as EURGBP found a few bids until the data inspired another surge which saw GBPUSD jump to 1.6867 and EURGBP back down to 0.8119.
Traders were quick to book profits though and we were rapidly back 1.6850 then 1.6830 then 1.6820 with EURGBP back at 0.8140 in equally rapid time which in turn dragged EURUSD up by its bootstraps after earlier dropping to 1.3679 from 1.3708. EURJPY had similarly come in for a slap from 139.05 to 138.54 with USDJPY needing no excuse to drop from 101.44 to 101.25 before both ran into buyers again.
NZDUSD has followed its neighbour lower to 0.8574 while USDCAD has been hemmed in once again, this time around 1.0885.
A lively start to the session that has since ground to a bit of a halt but these markets are fragile enough to kick off again later.
