Forex trading headlines from the European morning session 21 May
News:
- BOJ’s Kuroda says QE has pushed up demand
- BOJ’s Kuroda says they are not linking growth rate with monetary policy
- BOJ’s Kuroda says positive cycle in economy is working
- Shares in Gazprom rise 2% after signing long-term gas supply deal with China
Data:
- UK retail sales April m/m +1.3% vs +0.5 % exp
- UK BOE MPC vote 9-0 to keep rates and QE on hold
- Eurozone current account March nsa EUR +20.9 bln vs +13.8 bln prev
- Nikkei closes down 0.24% at 14,042.17
- Shanghai Composite Index closes up 0.84% at 2024.95
It’s been a session of opportunity but essentially centred on two main moves both to the plus side for yen and pound with related pairs also playing their part.
Lack of any plans from Kuroda for further easing saw USDJPY stumble down to 101.00 from 101.20 then triggering stops down to the next key support line around 100.75-80. EURJPY needed no excuse to dip to 138.23 from 138.60 and GBPJPY had a look below 170.00
The next phase of the session saw some EUR recovery which had EURUSD posting 1.3723 from 1.3705 after breaching 1.3710 and triggering stops only to run into the large offers again leading into 1.3730. EURJPY and EURGBP both had a small rally until we had the surge in GBP prior to the UK data release which saw cable jump to 1.6885 from 1.6855 and EURGBP fall through 0.8120 again.
The much better than expected, but leaked, release saw another jump to 1.6922 and drop to 0.8101 with a largely neutral set of MPC minutes but still hinting at interest rate rises sooner rather than later. Since then though the longs have run out of patience and we’re back to 1.6885 with EURGBP now falling again from 0.8115 to 0.8096 or renewed euro sales and USD buying as EURUSD dips to session lows
USDCAD had a retreat to 1.0894 after looking above 1.0910 o/n but is back up there again now while AUDUSD and NZDUSD are both still on the back foot but caught in cross play crossfire
Plenty of opportunity and we’re not done yet by any means. We’re just not any wiser really.
