One 30- minute bout of equity buying in the U.S. session was about all that the market could muster ahead of the U.S. rate decision and statement from the FOMC on Tuesday.
Oil speculators offered bids up to $76.50 a barrel as gold trade held $1,280 an ounce. The dollar index held steady, not impeded at all by the moves in equities, and seeming to be anchored by the swath of Treasury selling that runs on Monday, Wednesday, and Friday of this week.
EUR/USD is holding onto support, but still unable to make a clean break towards huge resistance at 1.3250. If the Usd finds buyers this week the pair will very likely test 1.2750.
GBP/USD looks weak in the near-term, but is holding a mid-term long bias that is allowing the buying of support at the previous session lows. 1.5250 and 1.5750 are the main price action points of note.
AUD/USD absorbs the minutes from the last rate statement, and traders resolves will be tested in regard to long-interest rates but short-political fundamentals do battle. 0.9500 looks to be an area that the pair may not be able to easily break unless global markets make a concerted effort to move equities and commodities higher. USD/CAD, USD/JPY, and USD/CHF are offering very mixed near-term reads, with each moving on macroeconomic outlooks.
Massive sales of Treasury notes boosted the equity market in U.S. trade as the
garage sale of bonds goes into overdrive this week in an effort to support the risk markets and to off-set massive mutual and hedge fund redemption levels.
Adding to the ability of the market to reverse off a test of
support at 1,120 was sound-bite headlines revealing that 23 U.S. states have stopped house foreclosure proceedings, at least until some clarity comes on a court ruling last week that throws doubts over who can foreclose, on what, and how.
The bullish nature of U.S. trade was against a very quiet back-drop of Asian and European markets that were consolidating on the short side of risk.
The late-session moves may not be enough to easily break previous session highs as they come at a time that the U.S. is the only global market open, with automated algorithm moves hit on extremely light volume.
Marco Hague is one of the founders and principals of The London Forex Broadsheet (commonly known as TheLFB), a global forex trader portal with headquarters in the U.S. Hague began his career with the Bank of England dealing with foreign exchange control, and he has been trading for the last three decades. He has been involved with institutional risk asset ratio analysis and the implementation and maintenance of institutional trade desks globally.