Once the algorithms take over trade in the afternoon, the old equity/EUR/JPY correlation come back to the fore. Stocks raced higher in the final half-hour or so to end up 290 Dow points and EUR/JPY climbed right along with it. The EUR/USD leg is up about 90 pips from early afternoon lows while the cross is up a bit over a JPY.
Beware the 1.4000 level in EUR/USD as “optionality” (the idea that large exotic options at that level will draw interest but also defense of that level) is certain to be a factor around a number that round number. Have a great evening!
