Forex: ECB Produced the EURUSD Break, Will NFPs Provide the Trend?
• Key event risk - ECB decision, US GDP - was the source of Thursday's volatility
• NFPs may feed Taper speculation, thereby gouging risk trends and finally provide a risk unwind
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This past trading day offered up the most action we have seen in months. Now, can Friday's NFPs adapt this surge in activity into a concerted risk-based trend? Looking at the top market movers this past session, there was evidence of a common driver in speculative positioning. With the S&P 500 sliding alongside EURUSD and the Yen crosses, we see a move that finds common ground in 'risk trends'. However, there was hesitation from the benchmarks (US equities) rendered steadfast by extracurricular means (stimulus), while individual event risk offered well-placed sparks in other key areas. Confidence is shaky, but a full-scale shift still requires a push. We discuss what to look for and what the trade scenarios are tomorrow in today's Trading Video.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.