The rally in sterling from recent lows has hit the skids in the last few days, with sterling-Japanese yen playing the technical levels beautifully again. After topping out almost exactly on the 50-day simple moving average at ¥122.47 and just above trend-line resistance going back to the April highs of ¥139, it has pulled back to support at ¥120. The downtrend is still intact and any rallies to ¥122 should be sold for the time being. Spread Co offers a spread on sterling-Japanese yen of ¥120.261-¥120.341.
Some analysts may have posted relatively bearish assessments for sterling-dollar, with suggestions that it’ll nose-dive into the year end. But against a backdrop of renewed uncertainty in the Eurozone and ongoing concern over the state of the US budget deficit, so long as some growth can be seen in the UK then these worries may yet prove to be overstated. The current IG Index price on sterling-dollar is $1.5710-$1.5711.
The wallabies aren’t the only thing from Australia that is down and out. Australian dollar-dollar is looking increasingly vulnerable as risk appetite takes a turn for the worse. Below $1.0150 opens the way to $1.0055 – a key technical support zone. Forex.com is currently offering a spread of $1.0148-$1.0151.
Despite trading near a one month high, the euro-dollar pair dropped off drastically as traders were shaken by the news that German leaders think it will be unrealistic to find a solution for Eurozone debt problems by the time of the European Council summit, scheduled for 23 October. The pair has strong momentum pointing downwards and has broken through a rising trend line, which could signal further weakness here. Capital Spreads quotes for euro-dollar at $1.3679-$1.3680.
Yesterday evening, the Bank of Japan announced that it is to form a special team to monitor initiatives designed to address the strong yen. The writing seems to be on the wall for the dollar-Japanese yen. The pair has been trending higher, on the assumption that a serious repatriation of yen was on the cards, but fell to the ¥76.6- ¥76.8 area on resumption of trading on Monday morning. The current IG Index price for dollar-yen is ¥76.75- ¥76.78.