Good morning,

Following the weak US Job report on Friday and no real news to the table, the markets were digesting the events and kept back on the button ahead of the important speech in the Fed this evening, where Yellen will address Congress on the Semiannual Monetary Policy Report, where the question will be if the Fed will continue the tapering in light of recent economic figures from the US economy. Markets in the EU US kept a slight positive mood with leading indexes up 0-0.5% and the USD sold off more or less across the board, while gold rallied.

Overnight, the Asian indices extended the good mood with aggressive risk taking, sending the Hang Seng and Nikkei up 1.8%, whereas the ASX in Australia took home 0.6%. The USD kept on the offer, and overnight EUR/USD has broken through the 50-day SMA with next resistance just below the 1.37-figure.  The Aussie outperformed on back of a positive surprise in housing prices for Q4. AUD/USD has increased for two weeks in a row now, despite a relatively dovish RBA, but recent figures has made market players speculate that this could change sooner than expected. Next resistance in the pair is at 0.9085.

Today, the European session will be relatively quiet as we have no economic news releases, but we could see some positioning ahead of Yellen at 15:00GMT. We could also see some positioning in GBP-pairs ahead of the Quarterly Inflation Report from the BoE tomorrow.