nside the Currency Market: EUR/USD Through 24 Hour Fix Prices
Posted by brian twomey on January 30, 2015 at 12:47amView Blog
EUR/USD 24 hour Cycle
The EUR/USD began Fed Day, Wednesday January 28th, 2015 with an opening price Fixed and set by the ECB at 1.1344. That price formally opened American market trading for not just the Euro but for 32 currency pairs and ? 496 possible currency paired combinations. The 8:30 ECB Fix opened American currency markets since its inception in London in ? 1800’s. Its no coincidence the Fix price coincides with major American market news. The purpose was to ensure price volatility occurs to allow deals to get done at certain prices.
Markets then trade until not only the 10:00 am minor economic news but the Gold price is Fixed for the EUR, GBP and USD by the London Market Bullion Association.
Markets again trade until the GBP Fix at 11:am. GBP/USD is most affected at this time as well as GBP/EUR, EUR/USD and all GBP pairs. The EUR/USD was Fixed at 1.1337.
At 12:00 Noon, the Fed conducts Currency Swap deals with Central banks and the Bank of Canada completes its “‘Noon Day” by Fixing its exchange rates. EUR/CAD is affected at “Noon Day”.
12:30 begins the FED exchange rate Fix. Wednesday the EUR/USD was Fixed at 1.1286.
The EUR/USD is clear again to trade until the 2:00 p.m. Bond market close. Then price becomes vulnerable until the 5:00 p.m. close.
New Zealand and Australian markets then begin trading but EUR/USD is affected only to the extent the RBA and RBNZ Fixes NZD/EUR and AUD/EUR.
EUR/USD next major event is the Beijing FIX that occurs at 9:30 am Beijing, 8:30 p.m. New York time. Beijing Fixed the EUR/USD at 1.1289.
Singapore and Kuala Lumpur next Fix the EUR/USD at 11:00 am, 10: p.m. New York time. The EUR/USD was Fixed Wednesday at 1.1283.
Manila opens 30 minutes later. The 11:30 am, 10:30 p.m.New York time Manila opening then Fixes the EUR/USD. Wednesday the Fix price was 1.1276.
30 minutes later, Jakarta and Bangkok Fixes the EUR/USD at 11:00 am, 11:00 p.m. New York. Both took the EUR/USD down to 1.1276 and the same as Manila.
Seoul is up next with the 2:00 p m, 12;00 Midnight Fix. Wednesday Seoul Fixed the EUR/USD at 1.1269.
Tokyo is next with the 3:00 p.m. Tokyo, 1:00 am New York Fix. Wednesday Tokyo Fixed the EUR/USD at 1.1274.
30 minutes later Mumbai opens and Fixes the EUR/USD at 12:00 p.m., 1:30 a.m. New York. Mumbai fixed the EUR/USD at 1.1279.
European markets open at 3:00 am New York and an advantage to EUR/USD traders because all prices worldwide are known. But trading is clear until the 5:30 am New York time Gold Fix again. Gold is again Fixed to EUR, GBP and USD.
The last major event to complete the cycle is the 11:00 a.m. London, 6:00 am New York time Libor Fix. This time prepares the remainder of the day to the 8:30 am ECB Fix. A new trading day then begins.
Brian Twomey, Inside the Currency Market, btwomey.com