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  • Writer's pictureMike Paterson

Markets still making their minds up after NFPs

Monday 7 August 2023

Friday's US NFP jobs data came in under expectations with downward revisions too but wages were seen to be on the rise and that stemmed USD losses. US bonds came in for a bit of demand overall pusing yields lower with markets second-guessing that the hiking cycle was proably over but Fed's Bowman came out over the week-end to say that further rate hikes may be necessary. USD demand returning this morning in Asia and early European trading as the jury remains out.

US Fed's Bostic and Bowman speak today at the Fed Listens event at 12:30 GMT. Bowman's opening remarks will be released prior to the speech but are unlikely to be much different for her w-e comments. Attention will turn to Thursday's US CPI data

Equities rallied on Friday post-NGFP but fell sharply into NY close albeit currently off their lows as the second-guessing continues. WTI has found a base again this time at $81.00-20 after breaking up through on Friday then rallying strongly before capping at $83.00 where a new resistance line is. Gold found support at $1925 in the NFP knee-jerk headline fallout but capping above $1945 as the jury remains out and tight ranges prevail. Geopolitical concerns still very much a threat to market stability with focus on Ukraine/Russia but increased tension in the Middle East too among other areas of conflict.

GBPUSD: Capping around 1.2790 on Friday after the softer-USD tones saw a recent rally from 1.2680 support post-NFPs but retreating below 1.2720 this morning as some USD buying returns. I remain bearish on the UK and GBP overall. Options in play at 1.2750. EURGBP: Now finding a cap at 0.8650 but equally holding 0.8610-20 in the retreats so far with lots of options in play. More two-way expected. GBPJPY: A good hold of 180.60-80 but sellers capping at 181.50 on Friday amid the mixed risk tones.

EURUSD: A good hold of 1.0930 on Friday before the post-NFP rally then capping at the strong 1.1040-50 resistance area to post 1.0975 helped by some USD demand returning. I prefer the rally-sell side still. USDJPY: Now underpinned at 141.50-60 after the post-NFP 142.80 cap. I remain a rally seller but with patience a virtue as ever.EURJPY: Good two-way business amid mixed risk tones and core pair flucation.Support at 155.80 but sellers will remain poised.

As we look at trading opportunities it's even more important not to over analyze but trade the price action with discipline and patience. I can help with this in my 1-2-1 sessions and now is the time, more than ever, to get on board with those if you haven't already done so. Contact me to take advantage of currently reduced prices.

Away from the markets I have to note the amazing 4-0 win on Saturday from my Southend United heroes amid all the off-pitch struggles. Truly stunning and the hallowed Hall was rightly rocking. Come on you mighty Shrimpers !!!!

Have a good week and let's continue to be careful out there.

Interbank rates: 08.45 BST

GBPUSD 1.2738

EURUSD 1.0991

EURGBP 0.8627

GBPEUR 1.1590

USDJPY 142.11

GBPJPY 181.07

GBPCAD 1.7020

GBPCHF 1.1143

GBPZAR 23.6780

GBPHKD 9.9167

USDCHF 0.8738

EURCHF 0.9607

EURHKD 8.5563

AUDUSD 0.6580

NZDUSD 0.6108

USDCAD 1.3377

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