Overall, the currency market traded side-ways during the Asian session, but jumped higher during the European trading hours. The move came in response to S&P futures and the oil market, as both posted strong gains during the European session helped by news that Bank of America managed to raise $7 billion in cash. Additionally, today’s calendar gave additional momentum to the major pairs, something that was not seen in the previous day of trading.
The Euro (Eur/Usd) is trading slightly above TheLFB R1 (1.3645), and near the highest value touched in the last six weeks of trading, after gaining 70 pips overnight. Most of the gains came shortly after the London open, inline with the equity futures markets.
The Pound (Gbp/Usd) rose more than 130 pips during the European session, pulled higher by the same S&P futures. Helped by the gains seen during the European session, the cable retraced most of the declines seen in the previous day of trading.
The Aussie (Aud/Usd) traded side-ways in the Asian session, but bounced higher during the European trading hours, breaking above the resistance trend-line that held the pair lower on Monday. The aussie is trading near the highest value touched since October 2008, with not much resistance to the upside as all of the daily simple moving averages are below the current price.
The Cad (Usd/Cad) cad moved lower since the Tuesday session started, in-line with the overall dollar direction and with the crude oil market. Moreover, the gains that crude oil has made recently has helped push the cad lower at a sustained rate over the last few weeks, retracing almost half of the gains experienced since the credit crisis started.
The Swissy (Usd/Chf) declined 60 pips during the overnight session, to TheLFB S1 (1.1040), paring most of the gains seen during the previous day of trading. For now, the swissy trades below all the important daily simple moving averages near the lowest value since January.
The Yen (Usd/Yen) moved side-ways during the early overnight session, even though the S&P futures lost some further ground, as the pair tried to stabilize. However, the yen rose in line with the same U.S. futures during the European session. The pair has gained approximately 20 pips since the start of the trading day and is currently above Monday’s close.