EUR/usd
Yesterday the market fooled us all. It happens. The euro's depreciation, caused by the ongoing uncertainty around Greece, attracted buyers, who further lifted eurusd above 1.28. Last night the pair jumped even higher, to 1.2865, on the news about the ceasefire in the Middle East. Looking at a bigger time frame, we see that EURUSD has been reversing since November 13. Each attempt to push the euro lower spilt over into new purchases – long lower shadows in the daily candlesticks clearly indicate this. It's remarkable that this coincides with the beginning of the rally in usdjpy. Thus, it follows that the euro is purchased by Asian investors on the speculations over the reinforced support of the economy by the BOJ. The bulls got what they had been after – the single currency grew above its 200-day MA despite the utterly disappointing beginning of the day. Thus, in the coming days buying pressure in the euro may grow due to the inflow of new money, staking on growth of the euro. The US employment statistics also encouraged the markets, supporting selling of the dollar and, as a result, buying of EURUSD. The sharp increase in the unemployment claims a week ago was partly compensated by the improvement last week. The unemployment claims decreased from 451 to 410K. The continuing claims also went down from 3367 to 3337. Of course, it's all very far from the minimum recorded two weeks ago, when the index was as low as 3163, however the current performance still inspires with optimism. As to optimism, by the way. The Bloomberg Consumer Comfort index indicated that now the number of the Americans who expect economic growth is the biggest over the last decade. This is really promising before the holiday season, which informally will start with Thanksgiving Day.
EUR/GBP
EURGBP has returned right to the level, where it was seen a day ago. All the attempts to go lower (on Wednesday night) and higher (last night) were thwarted by powerful forces which kept the pair within the trading range. The sterling was supported by the higher risk demand, which entailed depreciation of the dollar; against the pound were domestic statistics. The public sector borrowing proved to be larger than expected and than reported a year ago. Actually, it doesn't look very surprising if we take into account the economic slowdown this year. Though the third quarter was quite favourable, the public sector is facing some problems with tax revenue.
USD/JPY
The yen antirally slowed down a bit at the end of the US session. The local high in the pair with the dollar is 82.60. In the 4hr charts we see that the pair has been oversold already for a week, yet the bulls don't look discomforted by this fact. Many traders understand that the most powerful means to affect the currency are in the hands of the CB. This is why the promises of the opposing LDP to press the BOJ have such a significant effect on the yen rate. It's quite reasonable to expect that the pressure may persist till mid December with the target at 84.
The US stock market keeps moving off its local lows. Over the last seven weeks when the stock exchanges were falling, most stocks became attractive for buying, thus freeing some space for further growth and increasing chances of the favourable Santa Claus rally.
