Forex Morning Briefing
$DXY, $EUR, $JPY, $GBP, $AUD
Commentary: Keep your eyes on EUR/JPY, plus USD fell on the back of a report that China is considering reducing or halting its purchase of US government debt. PE
EUR/JPY at 133.30 saw a low just below 133 Wednesday, it can bounce to 133.70-90 near term, there are increasing chances that it might eventually break below major support at 133. It would then target 130 medium term.
Note: A dip in the EUR/JPY would be triggered and accompanied by a fall in USD/JPY at 111.44 over the coming days, these pairs together could try and push the single currency to 1.1960 to below 1.19.
Now, EUR needs to convincingly rise past 1.20 in here. While the potential is still there and it did, in fact, bounce from 1.19 to above 1.20 yesterday, it’s failure to sustain the bounce is a little puzzling. Watch this carefully over Thursday and Friday.
The Chinese Yuan (USDCNY = 6.5054) strengthened a goodish bit yesterday on news that Chinese officials are recommending a halt/ reduction in the purchase of US Bonds. Let us see whether the USDCNY breaks below 6.49 today or moves back up today. A bounce/ rise is a little more probable.
Sterling (GBP) at 1.3507 is calmish amidst the volatility in other currencies and is likely to remain so for a few more days.
AUD (Aussie) at 0.7875 dipped but did not fall below 0.7800 and rose Thursday morning. This strength that could drive Aussie up to 0.7950-8000.