A lack of fresh negative domestic factors and a degree of political certainty has allowed technicals to drive the Forint higher this week. EUR/HUF has fallen sharply from October 4's 276.95 highs to levels under 265.00, not seen since June. There is talk of 265.00 option barriers giving way but price action, although heavy, suggests little in the way of stop loss action.
Modest short covering has lifted the EUR back to 265.00 from 264.30-40 lows. The market is lacking fresh supply and a rebound into the weekend now the risk. Looking to the Friday session and August industrial output provides the data focus. Current account, producer prices and import/export data from the Czech economy could also have some Friday influence.
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