EUR/usd
Friday's trading was relatively volatile and didn't have any particular direction. For no special reason, there were upward spikes, then followed by consecutive sell-offs which drove the pair back to the initial levels. This performance is typical of portfolio rebalancing. It's remarkable that by the end of the trading day the single currency had returned to the opening levels of the day. Besides, despite the sharp fluctuations of 90 pips in an hour, the pair didn't manage to go beyond the high/low limits of the previous day. The beginning of trading in Asia was rather cautious, which put a certain pressure on the single currency, yet the Thursday low (1.2918) remains untouched. We should acknowledge that against our expectations the markets failed to perform a reversal on Friday. We will be cautious in our forecasts for the market today. Turning to the fresh news, we should note that the new ESM fund will enjoy the same lending capacity as its predecessor. As a result, its fire power will amount to €2trln. As you remember, the markets weren't very enthusiastic earlier, neither are they impressed by this sum now. Traders and investors are more in favour with draghi's and Bernanke's statements about the launch of time- and size-unlimited purchases of toxic assets. The disagreement between Merkel and Hollande regarding the time to start the work of the banking union causes some anxiety too. Germany, as usual, prefers not to hurry with closer integration until the affairs in the countries, which it is forced to integrate with, get better. However, this discord is not new and therefore can be treated as just a background rather than a major reason for the slack performance of the euro. From the technical viewpoint today it will be interesting to see if players will manage to push EUR/USD below 1.29, it means below the level from which the pair began its rally on the news about the QE3 launch.
GBP/USD
The British pound feels much better than the euro. It's seen in the performance of EUR/GBP, which was declining all through the last week and, as a result, leveled the growth of the second week of September. In the meantime the Cable is trading flat. The attempts to get to 1.63 stumbled over heavy sales on Friday, which drove the sterling back to 1.62. Some cautious players remember that at the end of last April the pound already got that high, after which followed a wave of heavy selling with a drop by more than 10 big figures. Taking a broader look at the situation, it is peculiar to the sterling to fluctuate between 1.53 and 1.63. And now most of the time trading is held below 1.60.
USD/JPY
Just as we predicted right after the announcement of BOJ's decision, the government didn't dare to launch any serious struggle, implementing no sizeable QE. For this reason, the purchases of the dollars for the yens didn't last for long. Hardly had speculators left the game when the market forces put everything into its place. USD/JPY is again at 78.0, below its 200-day moving average. From there we can probably see a reversal up, however it's still hard to find internal factors, which could structurally and steadily move the pair up.
gold
Gold behaves just like the sterling. The consolidation is held at rather high levels. On Friday the attempts to push the instrument above 1790 (the highs of late February) ran into a serious pressure from bears. Apparently, the players have decided to spend a bit more time on consolidation than we supposed before.
