Another week, same speculation

Monday 24 June 2024

Friday brought more USD demand in the wake of stronger than expected flash US PMIs with USDJPY racing higher through 159.00-50 in a hurry and steadier risk sentiment still producing JPY selling too, along with the carry flows, on the cross dips and therefore tempering losses on core pairs.

Data slate light today with little on CB speaker front too so let's see how the markets want to play this. Could be quiet but we'll be on standby for action as always.

Equities still seeing two-way trading amid the CB/political conjecture but remain underpinned albeit with sellers still lurking.  WTI still seeing good support and been up further to test $81.65 this time helped by the generally steady risk sentiment and recent OPEC inventory speculation that I highlighted last week. A retreat since but a hold of $80.00-20 and nudging higher again as I type with more two-way expected. Gold now finding a base at $2315-20 after failing at $2365 again. Dip demand should remain but profit-takers still poised.

GBPUSD: Support coming in at 1.2620 on Friday and 1.2635 this morning after failing at 1.2680 amid the USD demand.EURGBP and GBPJPY flows still in play too. EURGBP: Holding 0.8445-55 now but capping 0.8465-70 amid core pair price action and BOE/ECB conjecture EU politics still casting a shadow too. GBPJPY: Holding 200.80-00 then 201.75 this morning amid the steady risk/JPY selling and now testing 202.30.

EURUSD: Capping at 1.0720-30 still but a hold of 1.0675-80 a few times too as we continue to range tightly. Cross flows in play still too and large option contacts at 1.0690-00 and 1.0710-20. USDJPY: A strong, and sudden, rally again amid the USD demand/JPY supply double whammy but capping above 160.00 as MOF/BOJ intervention fears remain. Some option interest building at 160.00 too.

Traders - For more detailed analysis across a larger number of FX pairs including market order flows and options expiries email mike@mspfx.co.uk