- Japanese current account surplus for April -53.4% YoY against expected -39%
- Centre-right parties the big winners in European parliament elections
- Top Chinese banker calls for US help in the development of Yuan debt markets
- Sterling loses ground on the crosses after a very poor showing by Labour
- Nikkei up, Hang Seng down, in mixed trading on regional bourses
- Australia closed for public holiday
- China set to compromise on iron ore price
- US set to get tougher with North Korea
- JGB prices fall in line with US treasuries on Friday where the 10-year yields continue to rise
EUR/USD opened around 1.3965 and USD/JPY at 98.75 after big moves in NY after the NFP on Friday. The first move was down in EUR/USD and early trade saw the 1.3935 low from Friday get broken. The follow through was very poor and dealers refer to significant bids at 1.3925 which the selling could not even make a dent in. Short-covering immediately ensued and EUR/USD popped up first to 1.3975 and then to 1.4000 as the short-covering gathered pace. There were no major announcements to move the market. USD/JPY followed the EUR around the place and EUR/JPY was exceedingly quiet in a 40 pip range. Sterling lost ground, especially against the EUR, after the poor government showing in the weekend elections. The AUD was quiet due to the local public holiday.
Markets: Oil slipped a little, now back under $68/bbl. Gold also posted a small loss to $960/oz. The Nikkei is up 0.8%, Hang Seng -0.6%, Shanghai is up 0.25% and the Kospi is also marginally higher.
Orders: Strong bids now touted at 1.3925 in the EUR/USD; stops below .7875 in AUD/USD; unconfirmed speculation of option protection at 99.00 in USD/JPY with likely stops above; strong bids in USD/JPY at 97.50/65.
Ranges: EUR/USD 1.3925/1.4001; USD/JPY 98.29/84; USD/CHF 1.0834/95; AUD/USD .7930/85; cable 1.5927/79; EUR/JPY 137.35/95; EUR/GBP .8734/80
