Monday 29 January 2024
FX currency pairs still in second-guessing mode overall and ranging as we wait on the US Fed on Wednesday and BOE on Thursday with mixed USD tones and month-end signals still pointing to modest USD supply except in USDJPY. Friday's US PCE numbers showed softer core inflation but the headline figures were a tad more hawkish.
Nothing of note on the data slate today but the Ukraine/Russia war and Middle East Israel/Hamas/Houthi/Red Sea tensions still casting their own shadow and providing risk appetite fragility on reports that three US servicemen were killed in a drone attack in Jordan and US President Biden promising revenge.
Equities remain underpinned overall after falling into the NY close on Friday but off their lows and rising again as I type. WTI rallied again and gapped on the Asian open amid the weekend Middle East new to post $79.25 but with sellers poised still and back below $78.50 as I type but Red Sea concerns, and technicals offering some decent support overall. Gold also gapped higher in Asia only to fall back but rising again to to post further highs of $2034 after support into $2015-20 as we continue to range tightly.
GBPUSD: Holding 1.2690-00 this morning after capping into 1.2750-60 resistance again on Friday. I remain poised for further sells when momentum fades while we continue to range. BOE on Thursday in focus. EURGBP: Holding 0.8525 after capping into 0.8550 and still looking soft with bets on BOE holding rates for longer. GBPJPY: Capping this time at 188.30 but a hold of 187.75 this time amid the core pair and risk fluctuations. We can expect rally sellers to remain poised amid all the uncertainty in these ever fickle markets but still seeing some decent dip demand for the moment.
EURUSD: Support coming in at 1.0830 again after Friday's failure into 1.0880 amid some general EUR supply post-ECB. I remain a rally seller. USDJPY: Capping around 148.30 after holding 147.30 and now 147.75 in the latest retreat. Jobbing pips banked again and I remain a rally seller as preferred side overall.
For more detailed analysis across a larger number of FX pairs email mike@mspfx.co.uk
Interbank rates: 08.17 GMT
GBPUSD 1.2707
EURUSD 1.0834
EURGBP 0.8525
GBPEUR 1.1728
USDJPY 147.85
GBPJPY 187.90
GBPCAD 1.7056
GBPCHF 1.0950
GBPZAR 23.8490
GBPHKD 9.8933
USDCHF 0.8626
EURCHF 0.9347
EURHKD 8.4318
AUDUSD 0.6595
NZDUSD 0.6110
USDCAD 1.3437
Comments