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Forex Trading: London Market Wrap

Posted by Chris Advincula on Apr 8, 2013 7:45:00 AM

April 8 Monday 11:50 GMT

EURO

The euro made a modest rally to 1.3025 from 1.2970 (+55 points) in Europe buoyed by the continued broad weakness of the Japanese Yen and a lower dollar following the weak U.S. Employment data from Friday. Sterling also weakened against the euro which gave the single currency added momentum.

Euro-yen rose 110 points to 128.85 from 127.75 and held firm, while Euro-sterling rose steadily to the resistance level of 0.8510 from 0.8465 (+45 points).

Germany’s Industrial Production rose +0.5% in February, above the median forecast of +0.3%. However, January was revised down to -0.6% from flat.  The annual result was revised to -2.6% from -1.3%.

The initial reaction to the data was minimal since the January revision nullified the positive results of February.

 

YEN

The yen fell across the board for a third day after the BOJ announced last week  that they will boost monthly bond purchases to 7.5 trillion yen ($76 billion) exceeding the 5.2 trillion yen forecast. Dollar yen gained 1.5 percent on the day to 99.03 breaking a reported option barrier at 99.00.

The Bank of Japan conducted its first bond purchasing operations on Monday, saying it would buy 1 trillion yen of government bonds with maturities between five and 10 years, and 200 billion yen of bonds with maturities exceeding 10 years.

Dollar-yen rose 58 points to 99.03 from 98.45 while Euro-yen rose 110 points to 128.85 from 127.75 with continued weakness of the yen expected.

 

Chris Advincula

WorldWideMarkets, Ltd.

 

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Charts: FXTrek.com

 

 

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