Tuesday 7 November 2023
These markets are ever-fickle as I keepo banging on about and we've now seen the Greenback recover a few of its losses seen on Firday and early yesterday with variable risk sentiment returning after some much firmer/steadier tones too. The tragic Middle East back-story sadly continuing. JPY and CHF supply still notable overall amid the firmer risk and helping to underpin core pairs again but some reversal of that price action as I type.
The RBA duly announced their latest decision and a 25bps rate hike as expected lifting rates to 4.35% the highest in 12 years. Rhetoric was slightly dovish for future hikes but sitting alongside the caution shown by other CBs last week.
Equities fell in NY but recovered into the close and remain underpinned as European trading gets underway adding to some better risk tones. WTI has found some support into $79.00 as I type after cappin at $82.00 as the slippery side continues with the jury still out. Gold capped at $1990 this time as risk firmed with natural sellers ever poised still but has found support around the $1965 so far this morning as we continue to range tightly. Geopolitical concerns still very much a threat to market stability with focus on increasing Ukraine/Russia tension and now with the Middle East sadly to the fore.
GBPUSD: What goes up invariably comes back down in these fickle times and after capping at 1.2425 yesterday we're now testing support at 1.2300-10 amid the USD demand but retreat tempered along the way by some GBPJPY demand. I remain poised for rally sells when momentum fades but caution still required for the moment. EURGBP: Reverse move to GBPUSD as that pair's retret outstrips EURUSD and now testing 0.8685 after a hold of 0.8650 in yesterday's extended retreat. More two-way expected. GBPJPY: Holding 185.00 this morning amid the better risk tones after capping 185.70 then 185.50 with rally sellers ever poised still amid the fragile risk.
EURUSD: Now 1.0690 after capping at 1.0750 and I remain a rally seller overall. USDJPY: Breaking back up through the pivotal 149.80 area I highlighted yesterday and a steady rally to test 150.50 amid the USD demand and better risk tones. Some re-sells placed above 150.20 and I remain a rally seller as preferred side overall at these elevated levels but with patience a virtue as ever.
For more detailed analysis across a variety of pairs email mike@mspfx.co.uk
Interbank rates: 08.38 GMT
GBPUSD 1.2330
EURUSD 1.0705
EURGBP 0.8682
GBPEUR 1.1516
USDJPY 150.27
GBPJPY 185.26
GBPCAD 1.6927
GBPCHF 1.1063
GBPZAR 22.5573
GBPHKD 9.5973
USDCHF 0.8991
EURCHF 0.9624
EURHKD 8.3310
AUDUSD 0.6434
NZDUSD 0.5926
USDCAD 1.3725
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