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Euro Being Sold Before ECB Convenes

Due to the approaching ECB meeting, market participants on Monday have begun to reassess the open positions in their portfolio. After the ECB’s Ewald Nowotny made some remarks last week, traders began shedding euros and Swiss francs. They are temporarily transferring funds into British pounds and commodity currencies. Traders are worried that on Thursday the ECB could undertake additional measures with regards to the current QE program.

After the Asian session closed, the euro/dollar fell to 1.1308. The pound/dollar was up to 1.5460. Demand for the pound was up across almost all pairs. The pound is feeling a little more confident than the euro. The UK currency has received support from labor market and inflation data that was published.

The Australian dollar is up against its US counterpart after Chinese data was published. Q3 GDP for the country was set at 1.8% against Q2’s 1.7%. This is a 6.9% YoY figure, compared with last month’s 7.0%. Both indicators exceeded forecasted values by 0.1%.

News on Monday is scarce, so more attention is being paid to technical signals. The targets for the pound/dollar and the euro/dollar are at 1.5383 and 1.1287 respectively.

20 October, 07:35 (GMT+3)
Euro/Dollar: Expected Test of 1.13

Attention:

Forecasts which are made in the review constitute the personal view of the author. Commentaries made do not constitute trade recommendations or guidance for working on financial markets. Alpari bears no responsibility whatsoever for any possible losses (or other forms of damage), whether direct or indirect, which may occur in case of using material published in the review.

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