EURUSD Wow, the market loving risk still. Despite a scare on Euro debt last Monday, EURUSD continues to make strides to possibly test 1.47-1.48. Any dips(shallow at best) were bought up and triggered several option barriers. Also talk in the markets of Asian central banks re-balancing their portfolios and some buying Euro sovereign bonds (China) keeps this pair bid, bid and more bid. With the news of S&P putting US on credit rating watch further fueled the move upwards. Bottom line- not enough bad news to derail the bid undertone but care that any event driven news could cause a quick deflation of positions as markets are generally long up to their eye balls. AUDUSD Same story here with domestic inflation possibly ticking up a notch after the floods in Queensland. Follows EUr and Risk play. Positive equity markets also aiding to keep a base under AUD. With a hike likely in H2 this is likely to keep investors happy with the already high yields. Buy on dips down to 1.0250 if we can see a pull back. USDJPY I've been calling 80-85 range and at one stage was in serious fear that the range could break out. But alas it's back well into the range and heading south sitting just atop 82. Below here is intervention territory so don't get too carried away. bOJ meeting this week and all eyes pinned on whether they are going to pump another massive dose of liquidity which will probably mean more carry trad opportunity but again care on intervention. Play the range otherwise. GBPUSD You can see it more clearly in the crosses the weakness of GBP as it's GDP numbers continue to show signs of weakness. Not bullish on this one so prefer to short GBPAUD. USDCAD Oil. Still bid on international markets amid still unresolved Libyan tensions. Market doesn't want to take this too low though still bearish. Small bounce below 96 but reckon look to re-establish shorts closer to 98. Good luck.
