Posted: Feb 22, 2010 5:00
Fed members endorsed a roadmap to tapering in comments Thursday, something that could lay the groundwork for a US dollar rally. The yen outperformed for the third consecutive day while the pound lagged. The calendar is light as the Asian week winds down. The 3rd of the last EURUSD long hit its final target at 1.3630 following the Nov 7 entry at 1.3440s. 2 Gold trades and 1 USDCHF remain in progress. Fresh trades will be examined around Friday's US NFP.
Ashraf wrote about the strong euro reaction, jumping to 1.3677 from 1.3543, and how it was all about what the ECB didn't say – namely the lack of dovish rhetoric. The other surprise is that an LTRO may be less likely than many analysts believed. Technically, the EUR/USD move is a breakout to the highest since Oct 31.