Pound rallies as some risk-on sentiment returns

Tuesday 14 August 2018

After the market volatility I reported upon my return yesterday we've seen some degree of correction as immediate fears recede and risk-on plays prevail again, but the jury remains out.

GBPUSD has rallied to post highs of 1.2810 this morning with GBPCHF and GBPJPY demand also notable but sellers remain poised in these fragile conditions.Immediate support/buying interest now between 1.2780-00 then more between 1.2750-60 and 1.2720-30 still as I warned yesterday.Sellers still poised around 1.2820 then larger at 1.2850. Still ranging though so keep selling the rallies but continue to be aware of dip demand given the extensive recent falls.

EURGBP failed above the 0.8950 area I highlighted too yesterday (GBPEUR down to 1.1168) and has retreated once again as GBP demand returns elsewhere. Sellers still poised around 0.8950 then larger between 0.8980-0.9000. Buyers remain at 0.8900 then larger between 0.8870-80 and 0.8850 still.

EURUSD has found a few buyers as the risk-on sentiment returns and has tested the 1.1420-30 resistance area but the jury remains out on Euro plays. Sellers still poised nearby around 1.1430 then 1.1450 and 1.1480. Large option contract interest at the now pivotal 1.1500 should help cap further rallies.Buyers lined up around 1.1400 with larger interest now into 1.1380 and 1.1350.

USDJPY has felt some love after yesterday's hold of 110.00 as safe-haven Yen demand recedes and broken back up through 111.00.Sellers poised between 111.20-30 with larger interest into 111.50 and 111.80. USDCHF remains underpinned above 0.9900 but still finding sellers with EURCHF failing to rally hence also highlighting that the Euro is not out of the woods yet.

AUDUSD has held the option-related support at 0.7250 and 0.7200. Buyers still at 0.7250, 0.7220 and 0.7200. Immediate sell interest still between 0.7280-0.7300 and containing the rallies with Gold slipping back through the pivotal $1205 level. USDCAD has fallen again after a failure above 1.3150. Sellers now into 1.3130 and 1.3150 with buyers poised around 1.3070 and 1.3050. The Rand has felt some love again as EM markets steady.

Fickle and volatile markets still prevailing so get your orders in to take full advantage of these moves.

Have a good day out there one and all.

Interbank Rate 08.45 BST GBPUSD   1.2801 EURUSD   1.1416 EURGBP   0.8919 GBPEUR   1.1210 USDJPY   111.07 USDCAD   1.3081 USDCHF   0.9913 GBPAUD   1.7611 GBPCAD   1.6742 GBPCHF   1.2685 GBPZAR   17.9805 GBPHKD   9.9246 EURHKD   8.8605