Friday 10 November 2023
Focus firmly on the US Fed yesterday and this morning with various speakers including Chairman Powell making it clear that rate tightening wasn't over as inflation still posed a threat. Cue US bond sell-off with the rising yields helping to bring USD demand back to the table and equity markets falling again. Wobbly risk sentiment therefore bringing JPY and CHF demand helping to cap core pairs too.
Soggy UK GDP data this morning hasn't done the Pound any favours while the RBA Minutes also pointed to inflation concerns still as per their rate hike earlier this week. The ongoing Middle East back-story sadly continues and casts its own shadow over markets.
Equities had another retreat on the Fed speak/bond sell-off before stesdying as European trading gets underway while WTI has found some support into $75.30-50 this time after capping around $77.00 again as sellers prevail with global demand concerns continuing. old capped at $1965 again but holding $1950-55 as risk appetite softened as we continue to range tightly.
GBPUSD: Capping at 1.2300 yet again and testing 1.2200-10 amid the USD demand and GBPJPY supply. Capping since at the previous 1.2240 support.I remain poised for rally sells when momentum fades. Options in play around 1.2200. Keeping some core shorts as USDJPY short hedges. EURGBP: Support at 0.8715 and now up through 0.8730 resistance area as GBP sellers prevail. More two-way expected amid the core pair fluctuation. GBPJPY: Holding 184.80 in th retreat from 185.50 but capping at 185.25 this morning amid the softer risk sentiment with sellers still poised amid possible MOF/BOJ intervention as USDJPY tests their patience again.
EURUSD: Support at 1.0660 still after failure into 1.0720 again amid the USD demand returning but ranging tightly still. I remain a rally seller overall. USDJPY: Posting 151.145 now amid the USD demand after finally breaking up through 151.00 yesterday. Some jobbing pips banked to improve the position average and I remain a rally seller as preferred side overall at these elevated levels. MOF/BOJ cast a shadow still.
For more detailed analysis across a variety of pairs email mike@mspfx.co.uk
Interbank rates: 08.46 GMT
GBPUSD 1.2220
EURUSD 1.0671
EURGBP 0.8733
GBPEUR 1.1450
USDJPY 151.40
GBPJPY 185.00
GBPCAD 1.6875
GBPCHF 1.1023
GBPZAR 22.8758
GBPHKD 9.5194
USDCHF 0.9028
EURCHF 0.9635
EURHKD 8.3138
AUDUSD 0.6358
NZDUSD 0.5887
USDCAD 1.3806
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