With a slight fundamental load today, the market started the weak with mixed sentiment and tight ranged trading ahead of more clues over the outlook to be detailed this week.
The euro area caught the slim attention today amid the lack of data, where investors focused on the services and manufacturing sectors' slowing performance as a downbeat sign for the outlook discarding that the sectors continue to expand.
The euro will have more data on queue this week which is likely to add to the volatility expected this week, though in general the expectations remain bearish. The pair last week closed below the breached neckline for a bearish pattern at 1.2730 and remains below this level today setting the highest at 1.2729 and hovering still around opening levels at 1.2702 off lows recorded at 1.2680.
Lack of major market movers influenced the tight raged trading though volatility is still expected to prevail this week with downside tendencies for the euro targeting 1.2470 and 1.2350 as far as trading is steady below 1.2820.
As for sterling, the lack of data did not help the currency much where sterling advanced against the fragile dollar to set the high of 1.5617 and retreated from there lower and currently trading around 1.5547. The pair reversed from the highs recorded today targeting now 1.5530 support where it needs to stabilize below this level to extend the bearishness beyond the recorded low so far at 1.5522.
As for the Japanese yen, it continues to gain on the back of the remaining jitters and tension in the market. Investors focus on the weak prospects for growth and the downside pressures on the recovery which increases the demand for haven and unwinding of risk. The USDJPY pair so far recorded the high of 85.71 and the low of 85.07. The pair is still projected to continue moving south this week as far as steady closing is seen below 86.40 targeting initially 85.15 as stabilizing below it extends the decline towards 83.80.
Nonetheless, amid the mixed sentiment in the market and the volatile session, our favorite pick of the day is still the Australian Dollar. Aussie managed to recover all its losses and turned higher after the unexpected political void produced after Saturday's general election which for the first time in 70 years ended in a hung parliament.
The news at first were bearish on aussie yet as investors absorbed the news it reflected positively on equities and on the currency as investors saw less austerity and restructuring to be passed in the hung parliament. Aussie versus the dollar recorded the low of 0.8851 to rebound from there higher to set 0.8973 and currently hovering around 0.8959.