US Labour holiday and market undecided with no fresh flows post- NFP data led Asian and European sessions having a quiet day.

EURUSD closing above 1.2855 resistance supported the bullish picture on the horizon over the weekend but market failed to push the price beyond 1.2920 level due to corporate supply after 1.2900 option barrier was taken out.

USDCHF / EURCHF heading south after the news suggesting that “German Banks May Need to Raise $135 Billion on Regulations” and let’s see if the news bad enough to take EURUSD lower as well..

1.2830-1.2925 would be a safe range (1.2875 spot ref.) while 1.2865 appears as a good intraday level to watch today.

USDJPY failing to take the resistance levels out and heading south after each rally makes us feel like a new “EURCHF” status.  A possible double bottom test on its way at 83.6s as market long in xxx-jpy  post NFP with decent stop orders located below the support.

Good Luck All.

                          

The bullish reversal on risk sentiment in Asian session due to Aussie and Chinese data continued to dominate the rest of the day after better than expected US Manufacturing data.

Good sovereign demand appearing below 1.2725 in early London session helped market to trigger stops above 1.2750 and Euro being bought for EURCHF and EURJPY as a wash currency on a risk on theme accelerated the pace of the rally up to 1.2856.

I reckon market players ignoring the first negative print of ADP in 2010 may end up taking profit in long risk positions or use these levels to re-enter short risk positions before tomorrow’s NFP.

1.2785-1.2865 range is possible to dominate the Asian session before we see any clear sign on USD theme.

Good Luck All.

                          

The dovish FOMC minutes suggesting a possible re-invest in MBS instead of Treasuries if things gets ugly clouded the mood overnight despite better than expected US Jun existing home and consumer confidence data.

The rumor of big demand for US Dollars during month-end fixings did not have major impact as market expected overnight. EURUSD failing to break 1.2620 support with lows printing at 1.2625 caused a short squeeze during London session and pair traded up to 1.2744 and failed to take stop orders out above 1.2750.

Italian (74.2% higher 1 mnth change) and Irish ( 66% higher 1 mnth change) 5yr CDS grinding higher helping EURUSD to resist at moment against further QE winds in US.

1.2615-1.2775 range still dominates the pair while daily oscillators suggesting a possible test of weekly support at 1.2520 as long as daily closing stays below 1.2775.

Commodities heading lower on global growth concerns while Gold taking the advantage of safe heaven status and breaking the weekly resistance at 1235, suggests a further topside rally for XAU at the moment.

Canadian C/A and GDP failing to impress markets so far this week and risk aversion in the market led USDCAD testing the 1.0670 resistance and forming a double top on daily charts. A weekly close above 1.0695 increases a rally possibility up to 1.18s with a head & shoulder break out .

Good Luck All

                          

The scope of stimulus by BoJ did not impress the market players and that led USDJPY failing to break 86.00.
Equities ticking lower in US and for the rest of Europe on a UK Bank Holiday brought risk aversion / take profit related selling pressure to xxx-jpy in addition to BoJ disappointment.

Directional sellers capping the topside in USDCHF around 1.0310/30 area in Asian session yesterday help to boost the Franc strength on a risk averse day and pair traded down to 1.0237. The good support still remains solid between 1.0215-1.0230 for the pair which held it firmly last week.

EURUSD, despite further QE belief in the market, printed the lows in a stop-loss rush price action this morning at 1.2633 after 1.2775 resistance held it firmly yesterday.  We hear good demand starting around the good support of 1.2620.  A daily close below this support changes the outlook for EURUSD and opens the further downside risk for 1.2475/1.2490 area.  Short position stop orders reported above 1.2750 on the topside.

I believe we trade in a 1.2615-1.2685 range in Asian session today.

Good Luck All.

                          

Bernanke sounding  moderately dovish at Jackson Hole last Friday turns the eyes into FOMC minutes tomorrow to let us know if FED brings the 2nd wave of QE.  Non-farm payrolls on Friday and ISM data will also help to decide on the direction later.

Short risk covering in xxx-jpy and squeeze in JGBs caused USD-JPY rallying up to 85.77 and fresh bids appeared to buy the dips at 85.40/50 area  while the next target 86.30 to watch on the topside if 85.90 breaks. With eyes on BOJ in Asian session, we may see levels trading on both ends of the range today.

In EURUSD, market positioning for a rally pre-US numbers and Bernanke speech capped the topside on Friday.  1.2777, the 38.2% Fibonacci retrace of 1.1877 to 1.3334 rally, holds it firmly overnight while the risk is a test of 1.2855/1.2865 area with buyers on dips around 1.2715 and 1.2685..