The squeeze continues for the shorts in EURUSD as it recaptured the 1.2500 level on the back of yet further weaker than expected US data. It was as if buyers of the dollar had packed up early for Thanksgiving which will take the edge of today’s trading session and will suffer from very low volumes. At the same time we approach the end of the month and many investors might be looking to avoid what could potentially see a rise in volatility as the US goes on holiday.
As we mentioned yesterday, today sees the OPEC meeting get into full swing after the “fringe” meeting that took place between some non-OPEC and OPEC members. This was significant in that it shows OPEC’s willingness to embrace the concerns of non-members, but at the same time it was surprising to see no common ground on a cut in production since Russia in particular is hurting from the fall in oil prices. It would also seem that one of the main concerns coming from this preliminary meeting is the US’s resurgent strength in oil production and that lower oil prices are actually in the interests of non-US producers as it has the potential to halt North America’s shale boom. So with indications that OPEC production will remain around 30 million barrels a day, any upside to the price of crude looks very limited.
Also on today’s radar is unemployment data from Germany where the rate is due to remain at 6.7% and in between these figures is Eurozone consumer and business confidence, so we might see the euro get whipsawed around a little. Later on keep an eye on Japanese inflation data overnight as things have gone rather quiet for the Yen.