This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
There were some interesting FX moves, particularly in the euro and sterling which both managed to regain some ground against the greenback. This has put these two pairs right in the selling zone. Cable is testing $1.5800 and I feel this is a key level for the pair in the near term. Meanwhile,
EUR/USD is trading at $1.2500 which is also a key level. German CPI and another Mario Draghi speech will be the key events on the calendar today and could result in renewed euro weakness.
There is also potential risk coming from Greece with bond yields spiking on concerns around the disbursement of the last tranche of aid. As far as next week’s ECB meeting is concerned, it seems the market may be paring back expectations of immediate action after ECB Vice President Vitor Constancio suggested they will continue to assess data until Q1 next year before making a call. There is also a downtrend resistance line which comes in at $1.2500; failure to break this could see November lows retested.