The Wednesday session has been all about Sterling and the ever changing market mood towards UK interest rates. The Pound has been under pressure having topped out in the 1.99's last session and failing at 1.9830 earlier today. This activity has leaned on EUR/USD but the effect has been lessened by the pick up in EUR/GBP. Good two-way movement in EUR/GBP and GBP/JPY has also helped to steady the EUR generally.
With just mortgage index numbers in the US Wednesday diary the afternoon session for EUR/USD is again likely to be dominated by external factors, like the sterling moves. Option related interest closed to the 1.30 level looks to be holding the market steady ahead of the North American open. Good bids are touted between 1.2970 and 1.2980 while any recovery towards 1.3050 is expected to find reasonable offers.
There has also been more talk of good sized stops under 1.2950. The market is looking like 1.2950 to 1.3050, 10-day average and Tuesday highs. The bigger picture shows aily trend support at 1.2910 and a failure by price to close above the 21-day moving average today at 1.3027.
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