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Daily Report

Advantage Euro as QE Exit Eyed07 June 2018 by Dave Evans

Morning Report: 07.00 London

The euro is in control after hints from the ECB around tapering away from QE. Officials cited wage inflation as picking up in the likes of Germany as driving a recovery. Markets gave a relatively muted reaction as some market movers expressed caution.

The EUR/USD climbed for the fourth day in the road, looking to test 1.1800 from below. The EUR/JPY is unchanged this morning following six days of solid gains. The EUR/JPY has now recovered most of the Italy panic selling. The EUR/GBP has made further gains, but the pair remains largely rangebound.

Dollar pairs away from the euro are mixed, with the GBP/USD making its third day of gains, while the AUD/USD struggles.

Yen pairs are generally on the back foot, with the AUD/JPY making hefty losses so far, alongside losses for the GBP/JPY and USD/JPY.

Meanwhile, the Swiss franc continues to weaken, with the EUR/CHF making gains yesterday.

Coming up today

This morning’s highlight is UK Halifax HPI at 08.30.

US unemployment claims are at 13.30.

At 15.30, we get BOC financial system review.

MPC member Ramsden speaks at 16.00.

BOC Governor Poloz speaks at 16.15.

Trade Idea

The GBP/JPY is backing off a little this morning after a surge from the lows. The longer term trend is still negative though, which could point to further downside from here.

June 7th, 2018: Advantage Euro as QE Exit Eyed

A good way to play this is a LOWER trade predicting that the GBP/JPY will close below 147.00 in 14 days for a potential return of 133%.

June 7th, 2018: Advantage Euro as QE Exit Eyed