French President Marcon, in waiting.

French President Marcon, in waiting. 
EURO
EURUSD soared to a five-month high on the French election results as the two principal candidates (Macron and LePen) advance to the second round. The euro traded higher than expected, but with the betting line leading 90% for a Marcon win in the second run-off, the euro bulls were in command early.
Volumes soared on the EURUSD as both short hedges unwound and investors clamoured for top side exposure. Flow has been completely dominated by EUR and EUR crosses, but with the ECB later this week there may be some apprehension to chase this move higher,
Also, there could be a stutter step that may temper the EURUSD from moving much higher, given the looming second round of elections, and on its face, we could start to see greater risk premiums build.
With the European political risk fading to  the background, at least until round two, the markets will quickly pivot to President Trump and tax reform after US President unexpectedly said on Friday at a Treasury Department event that there would be “a big announcement on Wednesday having to do with tax reform.”
All in all, a very organised market this morning with liquidity stable from 5 AM Singapore onwards.
USDJPY
EURJPY which traded above 120.40 from 116.95 Friday has pulled USDJPY higher above 110.60, and we’ve seen real selling out of Tokyo as traders take profit on and expected outcome.
Outside of euro crosses, the market has been relatively tame.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Stephen Innes

Stephen Innes

Senior Currency Trader and Analyst at OANDA
Stephen has over 25 years of experience in the financial markets and specializes in Asian currencies at OANDA. After having started his trading career with NatWest Bank, he is currently based in Singapore as a Senior Currency Trader and Analyst with OANDA, focusing on the movement of the Aussie Dollar and ASEAN Currencies. Stephen has an extensive trading experience in Interest Rate Futures, Money Markets and Precious Metals. Prior to joining OANDA, he worked with organizations like Cambridge Mercantile, Nat West, Garvin Guy Butler, Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes
Stephen Innes

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