Balancing Act for the FX Market

After a flurry of market action before and after the thanksgiving holiday; as mentioned on our November 22 market view analysis, today and towards the end of the month of November would leave some breathing room for most traders who may have gotten caught in-between a relatively thin but wide price movements in the market.

The tension over the North / South Korea crisis, the European debt issues, and the US GDP data has tamed the traders / analyst for now as reflected on the market on almost most sectors including the currencies. The remaining factors would just be the economic reports due this week which may still be friendly for the USD on an overall perspective. Translating into a more positive outlook with variable corrective movements for most major pairs in the forex market. This is true to its form currently, the EURUSD and GBPUSD is making at the 1.3296 and 1.5632 respectively. Correspondingly, the EURGBP cross held its support at the 0.8419-0.8450 range while both the Euro and Pound headed lower to these price levels.

With the price page indicator in place while making these price movements together with the correlation with the USDX reaching its initial resistance levels between the 80.05-80.50 range after holding above the key price levels of 77.33 and 78.65. the corrective movement will entail a short term target at the 78.65-79.90 basis points. Depending on the outcome of the economic reports due this week that would re-confirm the directional trend of the USD.

All these price adjustments has left the market with more of the professional traders, hedge funds managers and major institutional in the main driver seat. Weeding-out smaller speculators that could not sustain such wide trading price fluctuations between the 150-250 pips in between trading sessions.

Watch for our mid-week report as we move forward towards the closing and opening of the new month of December which happens to be the end of the last quarter of the year that may also be a significant indicator for the rest of the year.