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  • Writer's pictureMike Paterson

Bring on the ECB

Thursday 6 June 2024

80th Anniversary of D-Day

We must never forget them.


Markets have been in wait-n-see mode over the past 24 hours ahead of today's interest rate decision and rhetoric from the ECB. Some decent two-way business albeit in tight ranges with tomorrow's US NFP data also in focus. Expectations are for a 25bps cut but guidance on the future speed of cuts will be crucial.


The BOC yesterday cut rates by 25bps with Gov Macklem making it clear that future decisions will be made month-by-month based on the Canadian economic data with caution expressed on inflation still. Ukraine/Russia war and Middle East tensions sadly still cast their own very large shadow. Remember as always to identify your preferred risk reward levels and let the algos do their thing.


Equities rallied steadily in NY helping risk sentiment but falling a little in early Europe with profit-takers still lurking as the CB second-guessing continues. WTI dipped then rallied too amid the better risk tones from $73.00 to now test $74.70 athis morning. Gold rallied to $2375 having held the recent $2335 support. Dip demand should remain but profit-takers poised.


GBPUSD: Capping at 1.2800-10 again after holding 1.2750-60 in the dip.EURGBP: Still tightly bound ahead of today's ECB decision and holding around 0.8495 but capping at 0.8515-20 this time. Expect more two-way as the ECB/BOE rate cut conjecture and cross flows continue. GBPJPY: Holding 198.80 yesterday and testing 200.00 again amid the better risk tones.


EURUSD: Holding 1.0850-60 again yesterday but failing at 1.0895 in the rally as we continue to range overall waiting on ECB.USDJPY: Good two-way business again with support at 155.40 but sellers prevailing at 156.40 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




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