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Week in FX: Europe October 23-28

Has this weeks EUR “euphoria” been the product of a short squeeze? Positioning can be partially blamed for the currency marching towards last summers trading range. Price action is also telling us that investor’s perception of ‘tail risk’ in the economy has been somewhat reduced. However, with the execution obstacles still high for EU policy changes, the market is likely to price for more easing, making the EUR a tad rich.

The week has ended trading in a tight range, dictated more by fatigue than by increased nervousness. Next week will be no less eventful with the ECB and FOMC dominating rate and policy announcements (easing vs. QE3) and ending with NFP and G20. Will Capital Markets focus now swing to Italy’s debt now that Greece wins reprieve?

Below are some other highlights of the week:


EUROPE

 

Is EUR euphoria priced out? [1]

What will the BoJ do? [2]

 

WEEK AHEAD

  • Market gets rate and policy announcements from the RBA, FED and ECB
  • GDP data from CAD and GBP
  • Manufacturing releases from CNY, GBP and USD
  • Employment changes and costs, NZD, USD and CAD
  • Building consent and permits from NZD, GBP and CAD
  • Retail Sales comes from AUD
  • Ending the week with CAD Ivey PMI

 

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.

Dean Popplewell

Dean Popplewell [7]

Vice-President of Market Analysis at MarketPulse [8]
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell
Dean Popplewell

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