Clearly, the U.S. bank holiday took any sting out of any tail but, that said, it’s generally been that way for a while barring a few whips and wriggles. I suspect this will continue over today – probably tomorrow also. Actually, maybe it’ll last through to the end of the week. That the continued sluggish development is most likely going to happen there won’t be too much profit to squeeze from the market. Therefore, the focus should still be on short-term trades. However, once the recent wild swings subside I suspect a more decent trending move.
Probably, EUR/JPY has suddenly begun to see some more directional moves. This has been driven mostly by losses in USD/JPY – but also the lackadaisical EUR/USD. There’s still a little more to go but before long, this should begin to slow down. This may well be the best outlook for today I feel.
The Aussie remains subdued. Nothing has changed from Friday in terms of expectations but still, it doesn’t look like being a frenetic day but instead a repeat of the slow development from just before Christmas. I really don’t think we’re going to get strong reactions for today and tomorrow.
As for the Europeans – the continentals should stagger through the day without too much of a range – and strangely enough this may happen with GBP/USD also following yesterday’s gap lower.