Daily Market Review – EURUSD off its four and half month high

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The European Unit extended its losses against the US Unit and during the Asian session, to touch a low of 1.4152. However, during the second half of the session the EURUSD pair showed signs of rebounding gaining some 27 pips to escape the trough. Earlier today the Euro was forced downwards due to growing debt concerns primarily over Portugal and Ireland. Investors will be focusing on a parliamentary decision of whether or not the majority of the members will support the new austerity measures the government suggested, with the Prime Minister threatening the opposition that if they will not support the measures he will resign. In the case that Jose Socrates will resign, Portugal will seek for financial assistance from the IMF (for third time in its history) and from the EU. While at the same time the EU leaders are discussing possible solutions to the peripheral’s debt problems. Some investors though, believe that in case Portugal will seek an IMF/EU bailout, the losses for the single currency will be limited as ECB will definitely go for a rate hike on April. Moreover rumors concerning an Irish bank that will not be able to pay a coupon, added extra weight on the single currency. However the bank rejected the rumors. Currently the EURUSD pair is trading at 1.4179, in a good momentum to retain the 1.4200 levels.

 

The Sterling after hitting a fourteen month high against the US Dollar yesterday on the back of higher than expected consumers inflation data, trimmed some of the gains at the mid stages of the Asian trade to hit a session low of 1.6342. At the latter stage of the session the GBPUSD pair has rebounded gaining some 42 pips to touch a session high of 1.6384. Cable investors will be focusing today at the BoE minutes which will be released at 09:30 GMT and will give indications of the future policies that the Bank is willing to follow. The British Pound is now trading against the Dollar at 1.6364. The GBPJPY cross pair was rather flat traded during the Asian session, but still holding the gains from the G7 intervention. Currently the Sterling is trading against the Yen at 132.30.

 

The Aussie opened the session suffering light losses, following the downward course of the EURUSD, touching a session low of 1.0063 at 01:00 GMT. The AU Dollar quickly appreciated against its US counterpart, gaining some 45 pips to end to a session high of 1.0107. The AUDUSD pair seems to have the fuels to climb higher during the day; currently it is trading at 1.0091.

 

The USDJPY pair was moving sluggishly throughout the session trading on a very tight range, but still holding most of the gains from Friday’s market intervention. The US Dollar climbed to a session high of 81.06 at 00:00 GMT and it is gradually falling since then, without any sharp moves as investors are wary for a new intervention. The pair is currently trading at 80.81. The EURJPY lost some 57 to hit a session low of 114.43 and now is trading slightly higher from the low at 114.55.

 

Mixed sentiments in the market kept the prices of the gold steady today. On one hand we had the escalating unrest in Middle East and on the other hand the nuclear crisis in Japan which is easing. Nevertheless the precious metal was traded higher compare to the US session as it climbed to a high of USD 1428.8 an ounce. The safe haven metal few minutes prior to the closing of the Asian session is trading at USD 1427.0 per ounce.

 

EURUSD USDJPY GBPUSD AUDUSD EURJPY GOLD
OPEN

(21:00 GMT)

1.4198 80.98 1.6371 1.0108 114.97 1428.3
DAY’S HIGH 1.4200 81.06 1.6384 1.0112 115.00 1428.8
DAY’S LOW 1.4152 80.79 1.6342 1.0063 114.43 1425.4
CLOSE

(06:00 GMT)

1.4171 80.84 1.6362 1.0088 114.57 1427.0