Forex Flash: G7 lead by political commentary – OCBC Bank
FXstreet.com (Barcelona) - Emmanuel Ng of OCBC Bank has taken a look at some of the prospects ahead for some G7 pairs.
Starting with EURUSD, he notes that apart from Junker's comments, the EUR was also weighed by news that 4Q German GDP had contracted more than expected. The EUR-USD may hover around the 1.3300 area in the near term and a breach may see a test towards 1.3240 and then the pivotal 1.3200 area. At this juncture, inherent upside bias for the pair we think has not been fully nullified just yet and he remains constructive towards upside prospects.
Looking to the UK, he comments that Cable chopped around and ended the global session slightly lower on Tuesday with CPI numbers also a non-mover. On other fronts, dovish comments regarding the economy by the BOE's King will likely reinforce the top heavy stance for the pair in the near term. Ng notes that a departure from the 55-day MA (1.6066) may open the way down to 1.6000 with the 200-day MA residing around 1.5909.
Shifting his focus east to USDJPY, he comments that the economy minister's veiled warning aside, markets are likely to attach more weight of the BOJ in the near term, with governor Shirikawa promising more "powerful easing". The next support level to watch for the USD-JPY is expected to be 82.00, followed by 87.40, if profit taking continues to persist.
Finally, looking to AUDUSD, he notes that the pair may look to the JPY-crosses for further cues in the near term and continue to base build in the near term pending further global cues. He finishes by writing, "In the interim, we stay supported on the pair and markets will be looking for any confirmation that the pair can successfully lay a foundation at the 1.0500. If this level is violated, look towards the 55-day MA (1.0451)."
Starting with EURUSD, he notes that apart from Junker's comments, the EUR was also weighed by news that 4Q German GDP had contracted more than expected. The EUR-USD may hover around the 1.3300 area in the near term and a breach may see a test towards 1.3240 and then the pivotal 1.3200 area. At this juncture, inherent upside bias for the pair we think has not been fully nullified just yet and he remains constructive towards upside prospects.
Looking to the UK, he comments that Cable chopped around and ended the global session slightly lower on Tuesday with CPI numbers also a non-mover. On other fronts, dovish comments regarding the economy by the BOE's King will likely reinforce the top heavy stance for the pair in the near term. Ng notes that a departure from the 55-day MA (1.6066) may open the way down to 1.6000 with the 200-day MA residing around 1.5909.
Shifting his focus east to USDJPY, he comments that the economy minister's veiled warning aside, markets are likely to attach more weight of the BOJ in the near term, with governor Shirikawa promising more "powerful easing". The next support level to watch for the USD-JPY is expected to be 82.00, followed by 87.40, if profit taking continues to persist.
Finally, looking to AUDUSD, he notes that the pair may look to the JPY-crosses for further cues in the near term and continue to base build in the near term pending further global cues. He finishes by writing, "In the interim, we stay supported on the pair and markets will be looking for any confirmation that the pair can successfully lay a foundation at the 1.0500. If this level is violated, look towards the 55-day MA (1.0451)."
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