Article / 06 March 2018 at 15:20 GMT

FX Board: Hard to hang our hats on recent moves – #SaxoStrats

Head of FX Strategy / Saxo Bank
By John J Hardy

Please see today's FX Board PDF attached to this post for the latest Notes of Interest, Trend and Trend Heat readings, as well as a few thoughts on key chart developments below.

EURUSD is up through a very local pivot area and 21-day moving average around 1.2350+, but that level is in the middle of the prior range and we won't know the quality of the move until the other side of the European Central Bank meeting on Thursday, where president Mario Draghi is likely to do what he can to talk down policy normalisation prospects, even if the ECB is somewhat committed to a timetable at this point for winding down QE. In short, confidence in new directional momentum is minimal until proven otherwise.
Source: Saxo Bank 

AUDUSD squeezed back higher after a mixed reaction to the less confident Reserve Bank of Australia overnight, likely as recent shorts have been disappointed by the inability of the recent break of support to generate more downside momentum. Buy the move is too modest to look decisive yet – as we have a number of instances of both weak directional moves that are reversed, and then reversals that fail to follow through.
Source: Saxo Bank 

– Edited by Clare MacCarthy


John J Hardy is head of FX strategy at Saxo Bank 
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FX Board for Tuesday, March 6, 2017

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