Friday 1 March 2024
Month-end came and went with little overall impact but we did see some decent volatility in FX pairs as Core MM US PCE came in at 0.4% as expected but the algos decided the lack of upward surprise and slightly lower YY was enough for a shove down in the Greenback before an equally rapid move back up.
So we start yet another month in second-guessing/ranging mode. Final EZ PMIs this morning are a little firmer but still well below the 50 growth threshold. CB speakers today include BOE's Pill then Fed's Waller, Bostic and Daly. The Ukraine/Russia war and Middle East Israel/Hamas/Houthi/Hezbollah/Red Sea tensions are all still casting their own shadow so while all the uncertainty remains, both economical and geopolitical don't get greedy or over-analyse. These are tight ranges and will produce regular opportunities therefore while the jury remains out.
Equities duly remain underpinned overall with the threat of some correction into month-end now gone. WTI testing $78.80 in a rush this morning after holding $77.70 again as the second-guessing on Red Sea/Gaza and global economy continues. Gold capping into $2050 this time but holding $2038 in the retreat as we continue to range tightly.
GBPUSD: Failure around 1.2675-80 again post US PCE data but holding 1.2610 in the retreat. I remain poised for further sells when momentum fades as we continue to range overall. EURGBP: Basing around 0.8550 still but capping at 0.8570 this time as the BOE/ECB debates continues. GBPJPY: Testing 189.00 yesterday and capping into 190.40 this morning as the risk and JPY juries remain out.
EURUSD: Support below 1.0800 again yesterday after duly failing above 1.0850 where I warned yesterday that sellers were lurking. I remain a rally seller. Some options in play potentially. USDJPY: Capping above 150.60 this morning after the decent rally from yesterday's extended/rapid retreat into 149.20 once we broke 149.50-60 support per my tweet. I remain a rally seller as preferred side overall given that the BOJ still don't want this racing away too far.
Traders - For my mentoring services plus more detailed analysis across a larger number of FX pairs including market order flows and options expiries email mike@mspfx.co.uk
Interbank rates: 07.37 GMT
GBPUSD 1.2632
EURUSD 1.0814
EURGBP 0.8559
GBPEUR 1.1681
USDJPY 150.43
GBPJPY 190.04
GBPCAD 1.7134
GBPCHF 1.1179
GBPZAR 24.2828
GBPHKD 9.8309
USDCHF 0.8857
EURCHF 0.9576
EURHKD 8.4097
AUDUSD 0.6507
NZDUSD 0.6090
USDCAD 1.3572
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