Currencies Consolidate After Big Moves This Week!

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Most of the major currency pairs consolidated today even with the release of the NFP, historically the biggest market moving event.

Interestingly the Euro was weaker than the pound today after the release of the best NFP of the year. This is due to the jump of the odds  of a Fed rate hike sooner rather than later. The Euro was resilient after the Brexit vote in large part because the market wasn’t expecting tightening from the Fed this year. Now after the upward surprise in the jobs number traders are liquidating their long Euro positions. The common currency fell to 1.10 and looks poised to close the day near the lows.

The pound, on the other hand, is consolidating for two days after the sharp fall this week. This is to be expected as the 1.28 low reached two days ago has spurred some profit taking action on the pair.

Nevertheless, this consolidation phase will end and analysts expect both the Euro and the Pound to continue to suffer against the US dollar. This will be even more so the case shall US economic data continue to be positive.

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