Wednesday 23 August 2023
While markets have their eye on the annual Jackson Hole gathering this weekend, with US Fed Chairman Powell speaking on Friday at 10.00 EST we've seen FX pairs continuing to range but this morning some pressure on the Euro after weak German/EZ PMI data reduced expectations of ECB rate hikes. Lagarde also speaking at Jackson Hole on Friday and now the second-guessing will only increase.Breaking news, since my restart, weak UK PMI data, particularly in the key Services area sees the Pound take a hit too as I type.
Equities have had another wobble in the past 24 hours adding to some risk-off tones in FX while WTI is in retreat again and posting fresh recent lows of $79.05 as I type after capping at $79.80-00 as the uncertainty continues. Gold finding support around $1890 in yesterday's retreat but natural sellers still prevailing between $1900-10 amid the general commodity/metals weakness as the jury remains out and tight ranges prevail. Geopolitical concerns still very much a threat to market stability with focus on Ukraine/Russia but also tension in the Middle East among other areas of conflict.
GBPUSD: Testing 1.2670-80 as I type amid some GBPJPY supply and given a fresh kick lower from the soggy PMI data. I remain bearish on the UK and GBP overall. EURGBP: Finding a cap at 0.8540 but holding below 0.8500 post German PMI and now higher again after the UK data with more two-way expected overall as core pairs make their mind up. GBPJPY: Capping at 186.00 this time amid the softer risk tones and now testing 184.00 after the UK PMI. Sellers will remain poised as risk remains fragile.
EURUSD: Holding support into 1.0800 after the drop from 1.0870 post-German/EZ PMI. I remain poised for rally-sells still. USDJPY: Capping at 145.80-00 now in the past 24 hours amid some softer risk JPY demand but underpinned overall with recent support between 145.00-20 still holding I remain a rally seller as preferred side overall but with patience a virtue as ever. I still regard the risk being to the downside.
More detailed analysis across a variety of pairs and 1-2-1 mentoring for traders from mike@mspfx.co.uk
Let's continue to be careful out there.
Interbank rates: 08.45 BST
GBPUSD 1.2724
EURUSD 1.0822
EURGBP 0.8506
GBPEUR 1.1756
USDJPY 145.40
GBPJPY 185.04
GBPCAD 1.7195
GBPCHF 1.1142
GBPZAR 23.6355
GBPHKD 9.8777
USDCHF 0.8794
EURCHF 0.9521
EURHKD 8.4066
AUDUSD 0.6430
NZDUSD 0.5948
USDCAD 1.3550
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