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Writer's pictureMike Paterson

Risk sentiment remains soggy and Pound making its mind up still

Friday 16 October 2020

Good two-way business for GBP pairs again amid all the Brexit and COVID lockdown uncertainty and today sees a statement from UK PM Johnson re current trade talks position. Comments already out suggest some positive tones and the Pound has found a few buyers but jury remains out.


Elsewhere risk sentiment remains soggy amid the global uncertainty while the US election polls still have Biden in front.


GBPUSD had another decent retreat but held 1.2880 this time around and since rallied on the Brexit-positive comments to test 1.2950. Re-sells duly made on the way up after some pips banked on retreat yesterday while remaining core short as per my many tweets. EURGBP found support at 0.9020 this time around but equally struggling to get back through the decent offers at 0.9080-85. I remain a dip buyer overall but respecting current two-way business.GBPJPY fell from 136.80 to 135.60 helped by softer risk and GBP supply but finding some dip demand this morning.


I stay poised to sell GBP rallies as my preferred side and buy back in the dips as ever.  Patience continues to be a virtue and entry level key as always. I still see dip demand though with markets and risk sentiment still in a state of uncertainty overall.Brexit remains the very big elephant in the room.


USDJPY failed into 105.50 this time but equally holding 105.00 still with large expiries there again today after yesterday's large congestion between 105.20-40.EURJPY has held 123.00 but failing at 123.50 with core pairs and risk both soggy overall still. EURUSD rally sellers generally prevailing again and we broke down through 1.1720 but finding decent support now into 1.1685. More pips gratefully banked as I'm not expecting a collapse any time soon.USDCHF found support this time at 0.9130 with SNB casting its shadow still as EURUSD capped but sellers still poised above 0.9160 with EURCHF still looking a little soggy for the moment.


AUDUSD has capped at 0.7100 after holding 0.7050 then 0.7070 but remains under pressure helped by RBA Gov Lowe's dovish comments a day ago and the softer risk/AUDJPY supply.NZD traders need to keep an eye on NZ election outcome headlines this weekend.USDCAD remains tightly bound amid the variable/fickle risk/USD/oil tones but now holding between 1.3200-50 with CADJPY selling notable again after breaking upo through 1.3180-00.


Markets are ever-fickle so don't forget to contact me if there's areas that you might need some further help with.


Let's continue to be careful out there in all things. Staying safe must be our main priority still. Have a great week-end.


Interbank rates:  08.46 BST

GBPUSD   1.2940

EURUSD   1.1715

EURGBP   0.9053

GBPEUR   1.1045

GBPAUD   1.8252

GBPCAD   1.7087

GBPJPY   136.19

GBPZAR   21.4172

GBPHKD   9.9638

USDJPY   105.29

USDZAR   16.5668

EURJPY   123.36

EURCHF   1.0720

EURHKD   9.0211

AUDUSD   0.7087

USDCAD   1.3209

USDCHF   0.9149


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