Monday 13 December 2021
COVID/Omicron unknowns continue to lurk and the UK has announced further "Omicron emergency" warnings and raised COCID-led restrictions to Level 4 (out of 5) which has undermined the Pound but second-guessing on Central Banks will continue to cast a shadow with the Fed meeting on Wednesday then SNB, ECB and BOE on Thursday. Today sees the BOC outline their monetary policy framework at 15.00 GMT accompanied by a speech from Governor Macklem.
Range trading still prevailing and good two-way business again amid the uncertainty and hence variable risk and USD tones but underpinned in the dips overall, albeit with the jury stll well and truly out.
As always, don't over-analyze or second-guess but keep your focus on price action in core and cross-pairs and identify recent ranges to see whether we hold or break and what levels present value for money. If in doubt, stay out. Patience will invariably be a virtue but don't confuse patience with being stubborn.
GBPUSD: Based at 1.3185 in Friday's retreat and 1.3220 since Followed by a rally helped by EURGBP falling before capping into 1.3280 this time. GBPUSD rally sellers, including me, ever poised while keeping one eye at least on the EURGBP and GBPJPY cross flows. EURGBP: Failure at 0.8550 (GBPEUR support 1.1690) this time and now testing 0.8500 (1.1760) as I type with EUR supply oustripping the GBP wobble still. Expect more 2-way business amid the general uncertainty. GBPJPY: 150.00 providing the support this time after breaking down through 149.80 on Friday but capping at 150.60 since amid the variable risk tones and general GBP weakness. Should continue to see good two-way business as risk sentiment continues to be ever-fickle.
I remain a GBP rally seller across the pairs overall as my preferred trading side albeit still against the grain currently so being patient as ever. These markets are ever-fickle so good/tight position management essential.
EURUSD: Previous support at 1.1260 nearby again after failing above 1.1320 as we continue to range but looking soft again. USDJPY: Capping at 113.80 again on Friday helped by those large options but 113.25 holding again too in the retreat as we continue to range. EURJPY: 128.00 support again after a hold of 127.80 on Friday but capping at 128.50 as Euro sentiment remains soft generally as risk tones remain underpinned. USDCHF: Support at 0.9220 again now after a good hold of 0.9200 on Friday with the SNB ever vigilant and helped by some general USD dip demand and EURCHF holding 1.0400. EURCHF: Holding 1.0400-10 again with SNB shadow lurking still after failing at 1.0435 as EUR supply returns.
AUDUSD: Heading for the support at 0.7130 again as I type after failing into 0.7180 amid the generally firmer USD tones and commodty currency supply as prices fall.USDCAD: A good hold of 1.2700 now and testing 1.2750 as oil prices retreat again amid some firmer USD tones generally. Moves remain ever-fickle and caution required but 2-way pips to be had still if you're not greedy.
Let's continue to be careful out there in all things. Staying safe must be our main priority still.
Interbank rates: 08.42 GMT
GBPUSD 1.3227
EURUSD 1.1277
EURGBP 0.8526
GBPEUR 1.1727
GBPJPY 150.33
GBPCAD 1.6857
GBPCHF 1.2250
GBPZAR 21.1622
GBPHKD 10.3833
USDJPY 113.65
EURJPY 128.18
EURCHF 1.0421
EURHKD 8.7864
AUDUSD 0.7142
USDCAD 1.2744
USDCHF 0.9241
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