EUR/GBP still the strongest trend in the market

This pair is definitely oversold on a short-term basis but it’s still got quite a bit of downside potential until it reaches longer-term ‘neutral’ levels near .7500. Reports yesterday from one of the big banks that reserve managers are reducing their overall EUR allocations will only add to the bearish sentiment.

The USD has caught a mild short-term up-swing and I’d expect this sentiment to remain until the next FOMC meeting when we get a bit more clarity from Yellen and co.

The market is slightly bullish JPY at the moment, especially on the crosses. It won’t take much to reverse this sentiment as the underlying conviction is still to sell Yen imho.

AUD, NZD and CAD are consolidating at the moment and I’m looking for medium-term buying opportunities in these three.