EUR/USD is back to pre-NFP levels in the 1.4860s after testing both extremes of the range over the last 24 hours or so. The market can’t make up its mind whether it wants to embrace risk (at relatively rich levels) or or take risk off. The macro environment remains unchanged with the Fed likely to keep its very accommodative policy for months to come as unemployment cracks the politically sensitive 10% level.
Look for traders to head toward the sidelines early Friday with some profit-taking/position-squaring likely ahead of the G20 meeting. Nothing ever happens at these things, but traders tend to guard against the outside chance that 20 finance ministers could one day agree to do something concrete on global imbalances. EUR/USD trades at 1.4865.
