Out with the old, in with the new

The FX market has stayed quiet and overall turnover is very low. The last day of 2013 is unlikely to be a busy one.

• Cable is trading steadily above 1.65 and this is one trend which is unlikely to let up any-time soon as the GBP still has plenty of ground to make up on the crosses.
• USD/JPY has moved higher in illiquid markets but I think we are starting to get into over-bought territory. Timing is everything in the FX market and I’m waiting for a selling opportunity sometime in the next 2 weeks, possibly even close to 110?
• The AUD is starting to look cheap against the EUR and the NZD in my opinion but I’d prefer to stay in dip-buying mode rather than getting bulled-up at this time of year.
• As for the EUR? I’m bearish for the first quarter and prefer to play this view through the crosses, EUR/GBP in particular.