Euro Makes More Fresh Highs Overnight

It was a relatively quiet day yesterday for the markets with no great surprises from the data released and most of the majors traded choppily in recent ranges. The obvious exception to this was the Euro which had a sharp move later in the session to reach new highs above 1.1900, the jury is still out on the catalyst for this although comments from the Fed’s Bullard opposing more hikes certainly would have helped – more seasoned commentators would attribute such a sharp move to options barrier interest and weak stops above the figure as it came straight back off to sit around 1.1850 for the last few hours.

Looking ahead to today’s trading and it’s a massive day for the sterling with the BoE due tonight but first up we have Australian Trade Balance figures out in the Asian session, once again with the general sentiment on the dollar being so negative, any poor result in this data will be seen as providing a good dip to buy into.

Sterling is certainly front and centre for the London session as first we have the Services PMI data due as an appetizer for the BoE main course. No change in the rate is firmly expected but the market is now looking for a more dovish 2-0-6 vote from the MPC, to add to the potential volatility, Governor Carney is set to speak 30 minutes after the rate announcement.

Into the US session and we have the weekly unemployment data and the ISM Non Manufacturing PMI numbers to add to the mix, although this data should have a very short term affect with the market really looking towards tomorrow’s Non Farm Payroll’s data for confirmation of it’s next step.

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