Market insights

Pound Shorts Get Wiped Out - MI300524

Yesterday saw what looked to be a number of large, short positions wiped out in GBP/EUR.

There was a spike in the rate that instantly settled back.

This could have been caused by short positions (bets that the rate is going to drop) being closed out on automatic orders called stop losses. The rate was touching year highs again, and for the other times this happened the rate dropped back. This could have led to traders betting that the rate was going to drop again, and when it didn't their automatic orders could have triggered causing the spike.

Other than that Pound rates remain quite quiet.

The change could come later with the preliminary GDP numbers being released in the US. Analysts are predicting quarterly growth of 1.3% which would indicate the US economy is in good shape.

Going into tomorrow things could change again with Japanese inflation and unemployment numbers out.

If that wasn't enough there's German retail sales followed by the Nationwide, in the UK, releasing its change in house prices.

Business news centres on supermarkets promoting spending targets for rewards which is feared could lead to consumers over spending.

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Economic calendar

US: 13:30 Preliminary GDP Report

JPN: Friday 00:30 Inflation Report

JPN: Friday 00:30 Unemployment Rate

GER: Friday 07:00 Retail Sales

UK: Friday 07:00 Nationwide House Prices

As ever we look forward to keeping you in the loop and look out for our next update.

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