Setting the scene Greece got their debt risk rating cut down by 3 notches by Moody"s. ECB still talking about higher European rates. Oil is shooting up once again. People are buying EUR as the FED carries out their QE2 spending even when non farm payrolls improved and Unemployment is improving to below 9%. This is probably still working in the EUR"s favor. But for how long? I can't think this can last for too long but EUR looks still bid. Some trader friends told me people are talking about flight to safety into EUR and GBP . I can buy that if you take all the rich people in the middle east. If is is so, EUR and GBP could remain well bid for some time now. AUDUSD Firm on the back of continued talk by Stevens of a prolonged resources boom. China is still looking to achieve 7% per anion for the next 5 years! Ok, this was shaved a little from about 8%. so we ask ourselves how much can the US or Europe grow? I am not particularly convinced AUD can sustain a big rush past 1.0250 even thought we are trading firmly on the high side of 1.01 today. I am still looking to reduce some longs, just in case. Watching EurAud and seeing if it can make a double top. USDJPY Bid. High oil normally means weak Yen. See it trading toward 83+ GbpUsd Still on interest rates expectations. And on the back of rumored safe haven buying from wealthy from Mid east, this could stay bait firm. But care as the buying could easily fissile out on the back of weak economic data. Don't lose sight of this. NZD Still weak after earthquake. We are sitting at 73 cents. No reason to be bullish here except to reduce longs. I think many Asian clients must be caught on way down through Dual Currency Investments. I would look to rallies to get out as economically NZ looks vulnerable.
