Forex news from the European morning session 9 Feb

News:

  • IEA says chances of an OPEC/non-OPEC meeting are very low
  • Japan's Suga says they will continue to monitor markets
  • BOE's Cunliffe says there's a case for MPC action if credit grows faster than GDP
  • More from Cunliffe: Small changes likely to have much bigger impact on debt sustainability than previously
  • ECB's Linde says he expects any new Spanish government to show respect to EU commitments
  • EU says that Greek review discussions have gone "fairly well"
  • Morgan Stanley lowers 2016 Russian GDP to -2.1% vs -0.8% prev
  • More from Morgan Stanley: BOJ will ease before July election
  • Police confirm at least 4 dead in German rail crash 9 Feb
  • Equity jitters once again calling the forex tune
  • Option expiries 10am NY cut today 9 Feb
  • Nikkei closes down -5.4% at 16,085.44
  • ForexLive media sensation makes another guest appearance on Tip TV

Data:

  • Germany trade balance Dec €+18.8bln vs +20bln exp
  • German industrial production Dec mm SA -1.2% vs +0.5% exp
  • December 2015 UK visible trade balance -9.92bn vs -10.40bn exp
  • France budget balance Dec YTD -€70.5bln vs -€82.8bln prev
  • US NFIB small business index Jan 93.9 vs 94.5 exp
  • Switzerland unemployment rate Jan SA 3.8% as exp
  • Japan machine tool orders Jan yy flash -17.2% vs -25.7% prev

It's been another roller coaster ride in the Fickle World of Forex theme park and today's theme has once more been all about equities and associated risk appetite.

A dreadful day for the Nikkei had seen USDJPY down to 114.21 in Asia but some pared losses into the close saw a look at 114.85 only to fall back to 114.70. Then came a sharp rally to 115.20 with the rumours of BOJ checking prices and then steadier openings for European equity markets saw a further test of 115.50 res/supply.

This had seen the euro give up early gains and EURUSD fell back to 1.1162 from 1.1205 with EURGBP back down to 0.7731 from 0.7787 which in turn gave cable a lift up to look at 1.4450.

Oil had been performing better too but rallies were capped by a less than bullish IEA monthly report and that un turn may well have been another reality check for equity markets which then proceeded to tumble.

DAX posted lows of 8911 before wiping its feet only to now plunge lower still to 8801 as I type and oil heading further south too.

Euro demand has returned, risk-off spreading throughout the pairs which has seen EURUSD climb back above 1.1225, EURGBP test 0.7800, and sending USDJPY back down to 114.80.

USDCAD is back up to 1.3927 on lower oil having held 1.3850 on the earlier dip while AUDUSD is on the back foot once again and now taking out 0.7000 support to post 0.6980.

These are fragile times and there are more to come.