Currency Markets Start with Early Weakness - Will it Reverse Like Yesterday?

By: Regent_Markets

The morning moves so far mirror what we say yesterday with the Australian dollar leading the fallers. It's almost a carbon copy of yesterday's start which ended with most markets in the black for today as news of Berlusconi's imminent resignation spread.

So far this morning, Chinese inflation has come in slightly above estimates while PPI came in below expectations. On top of these, Chinese retail sales and Japanese sentiment numbers were lighter than expected. This mostly explains the morning's weakness, especially in the Australian dollar with the AUD/USD down 0.65% and the AUD/JPY down 0.75%. The weakness is also impacting the NZD/USD which is down 0.56%.

The euro is also on the back foot, with the EUR/USD down 0.35%, the EUR/GBP down 0.45% and the EUR/JPY down 0.52%.

The yen is showing signs of renewed strength as the USD/JPY drops through the 78.00. No sign of the Bank of Japan so far.

We only have middle tier announcements to come today with UK trade balance at 09.30 and Fed Chairman Bernanke speaking at 14.30 the main highlights. The USD/JPY has started to drift lower, undoing some of the sharp spike higher following the Bank of Japan's intervention. Will they step in again? It's likely, but they delayed doing so for a long time after the last intervention in August. Still, it can't be discounted.

A good way to play this at http://info.betonmarkets.com might be a ONE TOUCH trade predicting that the USD/JPY touches 79.00 in the next 14 days. This could return 126% if successful.

Dave Evans
Email: editor@my.regentmarkets.com
Url: www.BetOnMarkets.com

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