Quickie before I get into some more deep technical matters:
There is a lot of different really important levels on USD crosses at the moment, where the payrolls numbers this evening (local Asian time) parked the currency markets:
- USD/JPY a hair short of 110 again (109.5-.6). I don’t ascribe a deep significance to this level, but as I have covered before, the resistance between here and 120 is very thin in the longer term and momentum is definitely on the upside here.
- EUR/USD is testing 1.25 (1.25200 at the moment, with lowest notes around 1.25100). This is a fairly critical level psychologically, and pretty much the divider line where I think it will be a lot easier for the ECB to talk the market around after all the support has been retreating.
- GBP/USD is below 1.60 for the first time in close to 11 months. Not my favourite pair, but definitely something worth keeping eyes on since it is slightly less liquid than the other two and any momentum pushes for the two pairs above will probably be prefaced by a push here.
Definitely sets up an interesting fourth quarter!