Monday 5th December 2022
On Friday I wrote that we should expect some fun and games around US NFPs and we got that in droves, and the usual second guessing a-plenty,after the algos sent the Greenback rapidly higher in the wake of US strong jobs and wages data only for a complete reversal of those moves once the detail had been more closely diseccted. Traders have been dancing on hot coals with USD supply mostly prevailing since Fed Powell's comments on Wednesday and moves may have been over-done heading into the data but equally so was the reaction.
The second-guessing continues as another week opens but Xmas holidays/year-end looming quickly in sight.Equities and oil underpinned again after the NFP dip but we've seen some USD demand return with US treasury yields nudging higher. Gold also underpinned but off its $1810 highs with geopolitical risk in Ukraine still lurking too, quite apart from all the CB second-guessing with FOMC now into a press blackout ahead of next meeting. China's further relaxtion of COVID restrictions could provide to be a double-edged sword with such a lack of vax in the community.
GBPUSD: A good hold of 1.2150 post-NFPs and a move back up through 1.2300 since but It's capped at 1.2350 in Asia and now looking at 1.2260-70 again as I type.I remain poised to re=sell. EURGBP: Finding good support at 0.8550-60 still and now pushing up through 0.8600 again.GBPJPY: A good cap at 1666.50 for the moment after a strong rally from 165.00 amid the USDJPY dip demand and better risk.
EURUSD: A decent hold at 1.0450 area again post-NFPs but capping into 1.0590.Should still see some mixed business. USDJPY: A Good re-sell opportunity into 136.00 duly taken post-NFPs.Good support into 134.00-50.EURJPY: Capping at 143.00 again after holding 141,50 as we continue to range. USDCHF: Struggling to take advantage of the returning USD demand after capping at 0.9430 post-NFP wth traders still looking at SNB tighteninmh and rallies tempered by some EURCHF dip supply returming. SNB ever-vigilant.EURCHF: A hold around 0.9830-40 again on Friday but capping into 0.9890 amid the USDCHF supply and we continue to range.
AUDUSD: Holding 0.6740 post-NFPs this time but 0.6850 capping agam.I remain a rally seller as my preferred side/strategy but equally a case for going long in dips atm. GBPAUD trading 1.8000-1.8150 now in the latest tight but firmer range as GBP finds some support again. NZDUSD supported at 0.6350 still but capped at 0.6450 in the extended rally abnd now testing 0.6400 as I type as USD demand returns. GBPNZD still trading a tad firmer on the general GBP demand but tempered by NZDUSD finding fresh legs higher too. USDCAD: A good hold of 1.3380 after the eventual break of 1.3400 but capping at 1.3450 this time amid the oil price and USD variables
Let's continue to be careful out there. Have a good week ahead.
Interbank rates: 08.50 GMT
GBPUSD 1.2283
EURUSD 1.0550
EURGBP 0.8588
GBPEUR 1.1640
GBPJPY 166.16
USDJPY 135.26
EURJPY 142.78
EURCHF 0.9866
AUDUSD 0.6806
NZDUSD 0.6405
USDCAD 1.3437
USDCHF 0.9346
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