NFP awaited. Markets coiling for a move
SNB Jordan comments sends the EURCHF higher
The EURCHF has gotten a push higher on the back of some comments from SNB Jordan who said the SNB would continue to support the EURCHF. The EURCHF moved up and looks to test the 200 day MA at the 1.20577 level. A close above this level would be the first close above the level since January 24th and would be the 2nd close above in the last 19 days of trading. The burden is on the bulls to force the price up. Sellers have been the big winners in this pair since December 7th.
GBPUSD looks to test support
Feds Evans favors more policy accomodation
- Would push to be as aggressive as possible
- Unemployment gap is very large
- Estimate need for over 1 trillion asset buys
- Isnt concerned about risk of deflation
- Normal channels of monetary policy clogged
- Asset buys should be substantial
Evans is not a voting member and his comments are curious given Bernanke’s down the road comments on Capital Hill. He is also a dove on the Fed.
GBPUSD correcting/consolidating
The GBPUSD has rotated back lower and looks toward target support at th 1.57936 level (38.2% and the lower trendline at the 1.5789. Look for buyers on the dip (against the support area). A move below each would open the door for further selling in the pair.
BOE Posen says there is a case for another 75B GBP of stimulus
Powen is a known to be a dove on the MPC
The QE stimulus (275B GBP worth) is scheduled to run off this month at which point the BOE will need to access whether they take the punch bowl away or continue to bloat the balance sheet of the central bank.
EURUSD moves toward topside trendline
Was it the comment that the dollar is a safe haven currency that sent the dollar lower? Perhaps. US interest rates are low because yes there are buyers due to increased money printing and perhaps because investors have no choice but overall the dollar is down.
The EURUSD is moving toward the topside trendline at the 1.3191 level. Above that the 1.3211 and 1.3226 become targets for the pair.
Bernanke: Expects inflation to stay below 2% target for next couple of years
- Even more agressive strategies than have been pursued recently to achieve fiscal stability are needed
- Dows not endorse or oppose extension of payroll tax
- Not satisfied with progress on dual mandate
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