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Forex Trading: London Market Wrap

Posted by Chris Advincula on May 14, 2013 7:38:00 AM

May 14 Tuesday 11:45 GMT

EURO

The euro fell to 1.2950 from 1.3028 (-78 points) against the firm dollar after the lower than expected German ZEW report. The single currency shed its prior gains to 1.3028 following the good Spanish 10-year bond auction and the slightly better than expected Eurozone Industrial Production data for March.  Germany’s ZEW May Expectations Index came in at +36.4 below the median forecast of +40.0, following April’s +36.3. The ZEW report raised speculation that the ECB will refrain from further interest rate cuts which weighed on the euro.

euro.5.14 resized 600

Chart: FXTrek.com

 

STERLING

Cable fell further in Europe to 1.5270 from 1.5325 (-55 points) and broke the intraday support at 1.5280 in a fairly subdued trading session. The dollar rose against most of the major currencies on extended gains from yesterday’s better results of the U.S. Retail Sales. The Bank of England will present is latest inflation forecast tomorrow, which prompted some market participants to unwind their position ahead of the significant report. The second-tier data from the Royal Institution of Chartered Surveyors of home price index climbed to 1 in April from -2 in March, the first reading above zero since June 2010.

gbp.5.14 resized 600

Chart: FXTrek.com

 

YEN

Dollar-yen made small gains in Europe to 101.75 from 101.25 (+45 points) but it remains capped below the 102.00 level where offers are noted between 102.00 and 102.20, while option barriers are at 102.50. Euro-Yen on the other hand fell to 131.55 from 132.20 as the euro demand weakened following the slightly weaker than expected German ZEW report. There are offers reported at 132.40 and 132.50, while underlying bids at 131.50.

yen.5.14 resized 600

Chart: FXTrek.com

euro.yen.5.14 resized 600

Chart: FXTrek.com

 

Chris Advincula

WorldWideMarkets

 

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