Monday 22 July 2024
The week-end's big news saw US President Biden finally stepping out of the current election campaign and endorsing his VP Kamala Harris. Her nomination is yet to be confirmed and markets will continue to second-guess the outcome and whether the "Trump trade" is still the one to go with. Some USD supply and JPY demand returning in Asia with USDJPY once again leading the way in a rapid move from 157.30 to 156.30 but climbing again as I type
China trimmed some key interest rates in a bid to stimulate the economy but the cuts were minimal and had little impact. Nothing of note on the data or CB speaker front today so I would expect a cautious start to the week after the volatility of recent sessions. BOC rate decision on Wednesday will cast a shadow over CAD pairs.
US and European equity markets have found some dip demand in Asia and early European trading but with rally sellers still poised for the moment. WTI failed at $82.00 then $81.50 before testing some demand around $78.75 where we remain as I type. Ever fickle for the moment and expected to range still. Gold is clinging on to support around $2400 amid some more profit-taking with sellers prevailing between $2420-30.
GBPUSD: Capping between 1.2950-60 on Friday but holding 1.2900 amid some USD supply returning but GBPJPY selling helping to cap. More two-way expected amid the USD and cross flow variables. EURGBP: Holding 0.8410-20 but still struggling to rally too far with ECB/BOE rate cut conjecture in play still. GBPJPY: Another volatile session in Asia amid the rapid USDJPY drop 24 hours capping at 203.50 but finding a base at 202.00 this time and on the rise again as I type as USDJPY dip demand. Sellers will remain poised but dip buyers will still think there's some value too.
EURUSD: Capping around 1.0900 but holding 108.75 as we continue to range tightly amid variable cross and USD flows. USDJPY: Finding a base at 156.30 in this morning's rapid retereat. No word from the MOF but they'll be in the frame again. MOF/BOJ intervention fears remain.
Traders - For more detailed analysis across a larger number of FX pairs including market order flows and options expiries email mike@mspfx.co.uk
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