Remain Short EURUSD, GBPUSD; Pending USDJPY

After the slew of comments and economic reports during the European trade today, the EURUSD looks for direction ahead of tomorrow’s non-farm payrolls report. During the overnight session, the IMF said that Portugal, Italy, and Greece are amongst the countries with the highest risk of unsustainable debt. Meanwhile, the European Central Bank held rates at 1.00 percent. During the press conference with ECB president, Jean-Claude Trichet, the central bank head sad that they will extend unlimited loan offerings into 2011, and went onto add that policy makers have no intention to signal any change in rates. I will remain short the EUR/USD at 1.3100 as the single currency remains capped by the 20-day moving average, while downside risks remain back towards 1.2500. Also worth noting is my GBPUSD short yesterday on the test of the upper bounds of the descending channel at 1.5446.The pair has come under pressure overnight as the IMF said that U.K.’s debt to GDP could rise to 90.6 percent in 2015. At the same time, housing prices, and the PMI construction reports in the region dropped more than economists’ expectations for the month of August, which added further weight onto the single currency. I will place my stop at 1.5550, with a target of 1.5250; entry at 1.54469.

Taking a look at my AUD/NZD position, I decided to take profits yesterday, following the massive advance on the back of the better than expected economic activity report yesterday. This decision proved well as we see the Aussie has lost ground against most major currencies on the day. Going forward, I will look to reenter a long position at a better price as my bias still remains to the upside. Nonetheless, I will stick to sidelines with regards to the USDJPY, and will enter a long position on a clear break above the 20-day moving average.