Despite the efforts of Merkel, Sarkozy and the world’s central banks, the euro continues to struggle well below its November highs and all key longer term moving averages. $1.3450–$1.3500 does look like a solid area of resistance at the moment, and any rallies into this area should be sold into with $1.3250 a realistic target. Spread Co offers a 0.8pt spread on euro-dollar of $1.33842-$1.33850.
Cable may have spent the bulk of the month so far hanging around that $1.5700 level, but with the threat of a ratings downgrade now looming for a whole host of Eurozone nations and US economic data starting to show some signs of weakness, the pound may soon defy its critics. There’s still the scope for surprises at the Monetary Policy Committee meeting, but the safe haven debate – austerity measures are working – has the potential to reinforce sterling-dollar as a sterling proposition. Current IG Index price $1.5633-$1.5634.
Who said the Swiss are boring? Euro-Swiss franc was the most interesting pair in FX yesterday. After weak CPI data out of Switzerland and low demand for watches and chocolate, the Swiss National Bank might be getting ready to up the currency floor to SFr1.25, which may cause this pair to grind higher in the lead up to the 15 December meeting. Forex.com currently offers a spread on euro-Swiss franc of SFr1.2378-1.2380.