 Euro is staying as the strongest one for the week, as supported by a chorus of ECB hawks. Markets are starting to price in a 75bps rate hike by ECB next week. For now, the strength in Euro is most apparently only against Sterling, Swiss Franc and Yen. It's kept well in range against Dollar. The next move in Euro would very much depend on August CPI flash to be released today. The greenback is also trying to extend recent rally, but momentum is not too convincing so far. ADP job data today might give Dollar a lift, but the key stays on Friday's non-farm payrolls. Technically, there are some levels to watch in Euro crosses to gauge if it's truly staging a bullish reversal. The levels include 0.8720 resistance in EUR/GBP (which is still quite far), and 1.4712 resistance in EUR/AUD (which is closer). Also, EUR/CAD is starting to build some momentum to challenge 1.3271 resistance. Considering bullish convergence condition in daily MACD, firm break of 1.3271 will be a strong signal of near term reversal, as least for a sustainable corrective rally towards 1.3713. But of course, rejection by 1.3271 will maintain medium term bearishness. In Asia, at the time of writing, Nikkei is down -0.51%. Hong Kong HSI is down -0.33%. China Shanghai SSE is down -1.00%. Singapore Strait Times is down -0.53%. Japan 10-year JGB yield is down -0.0005 to 0.227. Overnight, DOW dropped -0.96%. S&P 500 dropped -1.10%. NASDAQ dropped -1.12%. 10-year yield closed flat at 3.110. |
