Forex trading headlines 6 August 2014

The Eurozone got a stark reminder about the state of affairs in the economy as German industrial orders collapsed in the biggest fall since September 2011. Italian Q2 GDP missing by a large margin looks to have set the Italians back a few steps and overall Europe is looking pretty grim.

The Euro had already tested 1.3350 after the early German data and the morning was filled with further negative news and events. We took a dive through the half century figure as risk trades came off and a run to the yen fed across to the majors.

Stocks are looking in a bad spot too and the Italian data was just another nudge the FTSE Mib needed to fall out of bed and down the stairs as it fell nearly 700 points to a low of 19376. A couple of sessions more like this and we can start to call it a proper bear trend rather than just a correction.

GBP/USD looked like it was awaiting bad industrial figures of its own and sellers were duly rewarded as the number disappointed. Down to 1.6826 we fell instantly and the bounce could only manage 18 odd pips before the risk off wave washed it back down to 1.6822.

USD/JPY was slipping through support as the days news turned sour and we brushed through prior support at 102.40/45 to test older support at 102.20/30. 102.30 was the low but again a bounce has been minimal and we wallow at 102.39.

Yen crosses took a harder punch on the sentiment with GBP/JPY falling through 173.00 to a low of 172.15 and EUR/JPY dropped though 137.00 to knock out strong bids at 136.50. Big stops were said to be lurking on a break but we only managed a 6 pip push below to 136.44 so they may still be intact.

The market looks to be in a bit of a funk right now, particularly in stocks and a flight to safety is underway. European bond yields are up in the southern states while money seeks safety in German and UK bonds. German bund yields have hit another record low at 1.10%