European traders are at a virtual standstill as this is being written as decisions are awaited from the B of E and ECB in the next hour or so.

There may not be too much capacity for surprise on either decision but the recent surge in sterling could run out of steam if the B of E does not sound at all hawkish on UK interest rate hikes in its statement.

The bigger news will be the NFP data tomorrow from the US and a case could be made that today will be one of position squaring for the S&P 500 in anticipation of the data. As the futures indicate, the index has moved very close the 1130 target which nearly everybody now says is critical, which means that it probably isn’t.



EUR/USD has been behaving erratically during the last few hours as have many FX pairs and I'll be watching to see whether the EZ currency can sustain a break above the top of the cloud which would put a return to the previous recent high of $1.3265 in play.

I would not be looking at the short side unless there is a decisive break below $1.31 on the 30-minute charts.



Yesterday I suggested that EUR/JPY looked vulnerable to a return to the 112.40 level and that I would be looking to sell the pair at 113.50 which I have done.

Reviewing the chart action, I'll stay with a stop at 114.50 for the moment but the recent gyrations of the Japanese yen are clouding the picture and I may decide to ditch the trade sooner depending on the action in the next few hours.



Spot gold could have difficulty in regaining a foothold within the overhead cloud formation.



Clive Corcoran is the publisher of TradeWithForm.com, which provides daily analysis and commentary on the US stock market.