China seems to have the EUR/USD market on a string and they have probably picked their time well, with the market susceptible to ‘massaging’ in thin holiday-period trading. China announced late last week that their recent stockpiling of hard commodities is on hold (because they can’t get the stuff off the big queue of container ships quick enough) and this will mean that they have more USD in their coffers than they are perhaps comfortable with. My view is that they are more of a natural buyer of EUR/USD at the moment and as such their bids are likely to be stronger than their offers. Whilst they may be happy to sit on the offer after a decent rally, they may be moving their bids up as well. All in all, I see EUR/USD trading higher over the next 2 months with 1.38ish now the probable base and a target at 1.50ish.
Good luck today.
