Currency Updates:
U.S. Dollar Trading (USD) consolidation in European debt markets and confirmation that Italy PM would resign and that a new Greece PM had been selected added some stability and a little bounce to most markets. Adding to the positive Greek news was strong weekly jobless claims which dropped under 400k to 390k in a positive sign that employment was improving. In US stocks, DJIA +112 points closing at 11893, S&P +10 points closing at 1239 and NASDAQ +0 points closing at 2625. Looking ahead, UoM Consumer Sentiment forecast at 61.5 vs. 60.9 previously.
The Euro (EUR) Euro sentiment improved overnight after testing 1.3500 support in late Asian trade the direction reversed in Europe on easing Italian debt Yields. Talk in the market was the ECB was actively buying Italian bonds and some fresh bonds sold today by Italy did well. Resistance is seen at 1.3650 and focus will switch to Italian austerity measures to be passed as soon as this weekend.
The Japanese Yen (JPY) USD/JPY range traded but the crosses gained as traders sold the Yen when sentiment improved. The EUR/JPY is a closely watch trading pair which tested Y106 overnight but still well below the Y111 levels seen after the BOJ intervened last month.
The Sterling (GBP) traded between 1.5900-1.6000 as the market focused more of the Euro. The EUR/GBP grinded back to 0.8550 after finding support at 0.8500. The BOE held at 0.5% and kept the asset purchase program at 275bn as forecasted. Looking ahead, October PPI output prices forecast at 0.2% vs. 0.3% previously.
The Australian Dollar (AUD) the Aussie followed the Euro breaking to fresh lows in late Asian trade before reversing to test 1.0200 in the US session. The good Italian news was trumped when S&P mistakenly released they had downgraded France before letting the market know it was a mistake. The outlook is weakening as the RBA cut rates and the China economy cools down.
Oil & Gold (XAU) Gold fell back to $1750 on investor demand for cash before bouncing into the close. Oil is behaving very bullishly in recent sessions shrugging off negative news. $100 a barrel is the bulls first Target.
