Monday 1 August 2022
Out with the old month and in with a new one but markets are still second-guessing the Central Banks amid a back drop of fragile geopolitical global risk, inflation and recesssion threats. Next CBs up the ramp include RBA tonight and BOE on Thursday.
Some better sentiment this morning with equity markets on the rise again despite concerns over Pelosi's reported arrival in Taiwan tomorrow amid Chinese threats of retaliation. One to keep an eye on. JPY supply notable for the moment after another Asian USDJPY tumble to 132.05 from 133.50 sent cross pairs lower. Gold is still underpinned but oil is off its highs
As always, don't over-analyse but be ready with your preferred levels/strategy, place orders and let the algos do the heavy work. Discipline is key as always but equally hesitation can often ruin a great idea.
GBPUSD: Holding 1.2060 on Frida after capping into 1.2250 and some pips banked in the retreat again per ongoing strategy but a solid rally since amid the general USD supply. Soggy EURGBP overall still helping to support. I will stand poised for rally resells but patience a virtue still. EURGBP: 0.8365-70 support again after a look below 0.8350 lows amid the general EUR supply but failure into 0.8420 on the rallies and back to test 0.8380. I still think we'll see two-way pips jobbing opportunity but soggy EUR will limitt rallies as I've warned before. GBPJPY: Capping at 162.75 but holding 161.00 in the extended retreat with USDJPY once again leading the USD sell-off but some better risk demand this morning for the moment.I still it coming lower overall.
EURUSD: Support now at 1.0200 and a decent rally to test 1.2250 again as I type amid general USD supply and some better risk tones this morning. Sellers poised still.USDJPY: Capping at 134.65 after the hold of 132.50 but once again rally-sellers prevailing and another sharp fall in Asia amid the thinner liquidity. 132.00 holding so far but sellers will remain poised.EURJPY: Capping at 136.50 this time and a steady retreat to 135.15 before finding support again this morning. Sellers poised still whenever risk turns and/or reality checks back into town as I've been warning. USDCHF: We've had failure again at 0.9600 amid the general USD retreat after Friday's rally and CHF demand still and support at 0.9500 this morning being tested with SNB keeping an eye on things as ever. EURCHF: A hold of 0.9700 where I've warned SNB will be watching and small rally since to lookat 0.9750-60 but sellers will remain poised.
AUDUSD: A good hold around 0.6920 and then 0.6960 again as traders wait on the RBA tonight and the expected 50bps rate hike.Rally testing 0.7030 again helped by the softer USD tones and some AUDJPY and AUDCHF demand. GBPAUD holding 1.7360 again but tightly bound still after capping at 1.7460. NZDUSD with a good rally from 0.6220 this time and looking at 0.6330 again where we capped last time. GBPNZD holding 1.9300 again after capping at 1.9420 so still tightly bound. USDCAD: Capping at 1.2860 again and another retreat below 1.2800 in Asia amid softer USD but oil price capping has helped provide support at 1.2780 so far.
Let's continue to be careful out there and have good week.
Interbank rates: 08.40 BST
GBPUSD 1.2195
EURUSD 1.0230
EURGBP 0.8387
GBPEUR 1.1922
GBPJPY 161.57
USDJPY 132.47
EURJPY 135.52
EURCHF 0.9728
AUDUSD 0.7012
USDCAD 1.2793
USDCHF 0.9511
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