Tuesday 1 March 2022
The war in Ukraine sadly continues and I have little to add that you won't already know. The resistance continues but Putin appears to stepping up his attempts to take/besiege Kyiv with reports of a 40 mile-long miliatry convoy now just 20 miles away.....
Amid the mixed risk and USD tones equities, Gold and Oil are all once again off their highs but remain underpinned overall. Month-end USD demand flows now history and no concidence that we've seen some USD supply return. Meanwhile conjecture over Central Bank rate hikes continues.
The headline-algos will continue to jump on hot coals and it is not for us to second-guess each move but it can help to have a base view as long as you understand that what's in front of you is beyond your control. Still a case of not over-analysing amid all the noise but keeping your focus on price action in core and cross-pairs and identify ranges and what levels present value for money. Discipline is key in these whippy markets. If in doubt, stay out or at the very least keep positions trimmed/manageable.
GBPUSD: 1.3400 now broken as some USD selling returns and now forming a base but rallies limited amid the mixed risk tones. I remain a rally seller while keeping an eye on EURGBP and GBPJPY as always not to mention the current USD plays.EURGBP: Tightly bound still 0.8340-70 with good interest both sides and core pairs both slightly firmer. GBPJPY: Finding support at 154.00 in past 24 hours but risk still fragile and failing at 154.60 still. Caution still required atm amid Ukraine uncertainty.
EURUSD: A good hold of 1.1180 this time as USD supply returns but those 1.1225-30 offers providing a good cap.Have to consider cross flows in any core pair play. USDJPY: We're now testing 114.75-80 again with month-end demand out of the way and I hope the steer helped. EURJPY: Rally sellers prevailing at 129.20 now as USDJPY retreats and risk remains fragile. Bids 128.30-50.
USDCHF: Support at 0.9220-30 now history amid USD selling and EURCHF retreat and now testing 0.9150 with SNB never far away but sellers will remain poised amid the fragile backdrop. EURCHF: The retreat continues as risk-off CHF demand prevails and now testing 1.0250 amid the current reality check. SNB still keeping a close watch but can't hold out against combiond market forces.
AUDUSD: Good support coming in now at 0.7240 where we also have some option interest today after a decent rally amid some general commodity ccy demand and USD supply. Now testing 0.7280-00 again but capping as I type. USDCAD: 1.2700-20 now capping helped by USD supply returning and commodity ccy demand despite oil off its highs again. Good two-way business still expected.
Let's continue to be careful out there in all things. Staying safe must be our main priority still.
Interbank rates: 08.45 GMT
GBPUSD 1.3420
EURUSD 1.1222
EURGBP 0.8357
GBPEUR 1.1963
GBPJPY 154.30
GBPCAD 1.6987
GBPCHF 1.2282
GBPZAR 20.6005
GBPHKD 10.4542
USDJPY 114.93
EURJPY 128.97
EURCHF 1.0280
EURHKD 8.7389
AUDUSD 0.7285
USDCAD 1.2658
USDCHF 0.9160
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