Psychology for major markets Mar 8

USD soft after Powell, EUR soft on crosses after ECB meeting
EUR/USD – EUR/USD holding above 1.09, although the EUR is the weakest performer against the USD as Eurozone yields fall back. Still only a very mild positive tone, with 1.10 looking like a bridge too far. USD could rally on a strong employment number.
USD/JPY – USD/JPY weakening significantly as evidence of stronger Japanese wage settlements mounts and markets start to speculate on the possibility of an early BoJ tightening, with yield spreads still pointing lower. 146 handle providing near term support.
EUR/GBP- GBP slipping lower on general EUR weakness, but GBP gains likely hard to maintain as UK yields are slipping lower with EUR yields. Support likely found near 0.85. Longer term mild upside bias still seen given greater risks of a downward repricing of UK rate outlook.
AUD/USD – AUD breaking above 0.66 for the first time in more than a month reflecting a generally softer USD tone and resilient equity markets.
EUR/CHF – CHF risks still on the downside with EUR/CHF reaching its highest since early December, although EUR/CHF has come off the highs as the EUR has generally softened after the ECB meeting. More upside still possible as SNB remain one of the more dovish central banks.
Equities – US markets remaining close to all time highs helped by strong corporate earnings, but may be vulnerable to a decline in easing expectations if the employment report exceeds expectations.