Signs of life in both EUR/USD and GBP/USD

The European Central Bank’s monthly bulletin and the take up of the latest TLTRO tranche dominate traders’ thinking.

Euro and dollar notes

EUR/USD awaits TLTRO data

Greek political instability has sent shockwaves through both the currency and equity markets as the chances of Greek president, Antonis Samaras, holding onto power are far from certain.

As my colleague David said yesterday, we are also about to see the results of the second tranche of the targeted long-term refinancing operation and unlike the first tranche it will not be hindered by looming bank stress tests. Without this on the horizon, it is anticipated that the €82 billion take up could be more than double that.

The resistance at 124.5 cents has been broken and the direction that EUR/USD takes will be driven by the volume of take up from this morning’s 10.15am announcement of take up of the TLTRO’s.

GBP/USD close to 50-DMA

Today will see an absence of any real UK economic data and the last 48 hours of trading has seen a more pro-pound mindset as GBP/USD drifts higher and closer to its 50-day moving average.

Overnight, GBP/USD traded as high as 157.57 cents but has baulked at making an effort to break the current 50-day moving average at 158.40 cents. This morning could see the currency cross tread water as it waits for results in Europe.

We will also see the US release monthly retail sales figures and unemployment claims at 1.30pm (London time). At this time of year retail sales are scrutinised even more closely and this could offer further indications on how strong consumer confidence in America really is. 

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