Currencies
EUR/USD – is trading pretty much where it was yesterday as well. There is a lack of important data today and also tomorrow, but this will change on Friday. That doesn’t necessarily mean that trading will be boring though.
USD/JPY – has continued to move up, although slowly as on the one hand the JPY is showing strength due to the BOJ policy, or lack thereof, and on the other hand, the USD is also strengthening because of the strong NFP. At the moment it appears that the USD is winning the battle.
GBP/USD – has dropped below the 1.30 level again as the GBP continues to weaken on the backdrop of comments from BOE’s McCafferty who reiterated the BOE position made public last week that the BOE could cut the interest further and also expand QE if the situation warrants it. In addition to that, we have USD strength after the NFP. We will have important data out of the UK this morning as well. A bad reading and we could see the GBP weaken further as that would bolster the case for more QE and a lower interest rate.
Commodities
Gold – was able to hold above the support around the 1332 level, even though it dropped a little under this level in trading, but managed to close above this level. It does look like there will be another attempt to break below this level, as the USD is still staying strong.
Oil – moved up after renewed talks of a possible production freeze being discussed next month. Even though this was quickly denied, it also remains very doubtful that such an agreement would be reached, let alone be kept. Nonetheless, as we have seen earlier this year, only talking about it can cause oil to move up. At the moment we are trading around the downwards trend line, but below the resistance, so we are likely at a crossroad. A break of the resistance, meant we will move towards the next level, but a failure to do so, and we could head down again towards the 40 level.