On and on like Ariston. Readers of a certain vintage will remember that advert. GBP/EUR and its battle with 1.20 is giving me the same feeling. Where are we trading? Yup, you guessed it. Around the same level we were at on Friday. What’s on the calendar for today in terms of data? Not much to kick off the last week of November. We’re very light on data out of the UK and Europe today. We have mortgage approvals out of the UK at 09.30 this morning however other than that there is nothing of note.What should you do with GBP/EUR? If you can achieve anything over 1.19 I would look at covering off a high percentage of your upcoming exposure on a spot or forward contract basis. Why? Historically, we’re at the upper end of the trading range over the past few years. 1.20? Use this level on a market order basis should we see some EUR weakness coupled with GBP strength. I think we’ll need a mixture of both to push up and through the 1.20 level and settle above there. You can email myself or the trading team with your requirements and we shall implement these orders for you.
That leaves us with the US session. In a four day week this week for our friends across the pond due to Thanksgiving we have a raft of data out of the US with the question still remaining of ‘will they won’t they?’ of second guessing Fed tapering plans. The US Dollar has been firm in the overnight Asian session and we’re back to similar levels we were at on Friday. We have pending home sales out this afternoon along with the Dallas Fed manufacturing Index and 3 and 6 month Treasury bill auctions.
Cable? Have you placed your orders at the 1.6150/1.62 levels yet to purchase USD? The latter is looking toppish for GBP/USD. If you have an end of month requirement coming up it may be an idea to look at utilising market orders on a GTC basis along with an ‘OCO’. Should it trend higher you can always move your stop loss higher to limit your downside risk further on a daily basis. We can do this for you so that you don’t need to sit and stare at a rate screen all day. Please contact myself or a member of the trading team to discuss utilising these trading tools.
The beginning of the week is fairly quiet however Wednesday and Thursday is when I expect to see most volatility. We have the Inflation report hearing out on Tuesday followed by GDP data out of the UK on Wednesday morning. On Thursday attention turns to the Eurozone as we have unemployment data out of Germany followed by the release of inflation data from Germany in the afternoon. Friday rounds off the week with inflation data released from the Eurozone as a whole in the form of CPI. We also have the Eurozone unemployment rate released on Friday.
If you need to make a transaction before the end of the month and are looking at utilising orders I would suggest, and it’s only a suggestion, that you implement these today or tomorrow to give yourself ample time for the orders to execute this week.
Should you have any questions please get in touch with myself or the trading team. If you’re in the Knightsbridge area doing Christmas shopping feel free to pop in and say hello.
Have a great week.
Written by Liam Alexander.