All over-hyped? Rabbits caught in headlights? Markets still trying to dissect the detail in the reality that is top-end of forecasts and rumours ?
Whatever the reason behind the lack of expected volatility ( ok, so we’ve been a bit jumpy but nothing compared to expectation) one thing we can deduce is that yesterday’s leaks were cleverly placed to de-fuse, or indeed diffuse, the price-bomb that traders were expecting
EURUSD heading lower again after failing to consolidate the gains back into 1.1600 after the initial losses but we’re seeing decent momentum now as I type in the selling of other euro pairs. EURGBP down to test recent, and decent, support at 0.7575 and EURCHF back below 0.9900 with EURJPY also posting new session lows at 135.30
As I suggested in my preview though this relative lack of mayhem/pause for thought is not telling us that it won’t all kick off again. So it’s time to pick your levels when you’re ready ( if you haven’t done so far ) and make your calls.
The top-end of QE expectations, and the repeated doubts on its legality, tells us that the Eurozone and indeed possibly the ECB, is in murky waters , as if we didn’t know already, and the euro-negative tone running through at the moment reflects that uncertainty. The jury will remain out on whether all this will even have the impact hoped for by Draghi and his supporters
We still don’t know though how much of what they have delivered today is factored in at current levels, but we can be assured that there will be decent two-way business on euro pairs while the market makes its mind up.
