Friday 26 May 2023
US debt ceiling talks still creating some concerns understandably but there's talk of a 2-year deal in the pipe with the deadline approaching. Some USD supply returning after USDJPY breached 140.00 eventually but now in retreat although we can expect some dip demand still as the jury remains out.
UK retail sales data this morning showed improvement m/m but y/y still disappointing. Public holidays in UK, Europe and US on Monday although some markets will be open. Could see some position squaring today. I'm not sure of my w-e movements atm but If I'm around Monday I'll update, otherwise Tuesday.
Equities are steady this morning as I type after yesterday's up nd downs amid the fickle sentiment and WTI has capped at $72.50 amid the ongoing global economic growth concerns but holding $71.00 so far. Gold finally broke down through the strong $1950-55 support as the natural sellers and Fed tigtening expectations continue to weigh despite fragile risk tones but testing $1950-55 again as I type after holding $1935. Increasing tensions in the Ukraine/Russia war continue to be the elephant in the room along with US/China tensions as the world remains a fragile place.
GBPUSD: Failure at 1.2380 yesterday amid the USD demand and some risk-off GBPJPY supply again but finding support at 1.2310. Now nudging 1.2370 as USD supply returns but I remain a rally seller as my preferred side. EURGBP: Capping at 0.8710 yesterdaynd in Asia after aholding 0.8665 in yesterday's dip as core pairs range still. Expect some two-way business overall again. GBPJPY: Capping at 172.80 yesterday and testing there again now his time after holding 172.-30 yesterday in the dip. Rally sellers ever-poised but some demand expected too for the moment as USDJPY still remains underpinned.
EURUSD: Capping into 1.0745 yesterday amid the USD demand and again this morning but holding 1.0700 in yesterday's dip amid some general EUR supply. I remain a rally seller as my preferred side. Options in play. USDJPY: Still looking underpinned overall amid the general USD demand/JPY supply as the BOJ YCC conjecture continues but capping at 140.20 this time after holding 139.20-30 in yesterday's move lower per recent pattern. Some re-sells finally placed above 140.00 and I still prefer to sell rallies/be long JPY overall but ongoing caution/patience required as I've been warning.
More detailed analysis across a variety of pairs available from mike@mspfx.co.uk
Interbank rates: 08.45 BST
GBPUSD 1.2350
EURUSD 1.0733
EURGBP 0.8691
GBPEUR 1.1505
USDJPY 139.67
GBPJPY 172.42
GBPCAD 1.6833
GBPCHF 1.1165
GBPZAR 24.3353
GBPHKD 9.6207
USDCHF 0.9044
EURCHF 0.9707
EURHKD 8.3622
AUDUSD 0.6521
NZDUSD 0.6065
USDCAD 1.3621
Comments