Monday 8 October 2018
Conciliatory/optimistic comments from the EU on Brexit on Friday evening and Saturday have seen a few GBP buyers return but sellers have been jumping back in too in Asia and early European trading. Friday's US$ non-farm payroll and wages data brought little of consequence but trade war concerns still linger.
GBPUSD had originally held the 1.3060 pivot area but late in NY jumped up on Juncker's comments to test the 1.3130 level which was one of the sell areas I mentioned in Friday's updates. We're currently back on retreat lows of 1.3074 as European traders enter the fray helped by EURGBP bouncing off support around 0.8770. Sellers now around 1.3100 then larger still around 1.3130 and 1.3150 with more between 1.3180-00. Immediate demand now around the 1.3060 pivot then more at 1.3030-35 and larger at 1.3000 then 1.2980 and 1.2960. I remain a GBP rally seller while respecting the current demand helped by some M&A flows in recent days but Brexit is a long way from being settled still.
EURGBP has broken down further on the GBP demand to post lows of 0.8772 (GBPEUR up to 1.1402) but currently bouncing back to look at 0.8800 (GBPEUR 1.1365). Bids now around 0.8770 and 0.8750.Sellers poised around 0.8800 then 0.8830 and 0.8850. Currently happy to sit and watch this pair from the sidelines still with Euro variables also in play.
EURUSD has been up to test 1.1530 again but sellers prevailed once more and currently back below 1.1500. Large option contracts expiring today at 1.1450 will lend support.Immediate bids/support now at 1.1480 then between 1.1450-60 still, 1.1430 and 1.1400 with sellers still poised into 1.1530 then 1.1550-60, 1.1580 and 1.1600
USDJPY remains contained with bids still building around 113.50 then more between 113.20-30 and 113.00. Sell interest around 114.00 still then 114.20, 114.50, 114.70-75 and the key 115.00 area. i remain a rally seller. USDCHF has also traded tightly as the jury remains out on the Greenback and the finger pointing to some assistance from the SNB in recent times. EURCHF demand now around 1.1380 then 1.1360 and 1.1320.Sellers at 1.1430,1.1450 then larger between 1.1480-1.1500. USDCHF bids at 0.9900, 0.9880, 0.9860 and 0.9830 with sell interest around 0.9960 then 0.9980-00. I remain a dip buyer on both.
AUDUSD remains on the back foot undermined by concerns over the US-China trade spat to post fresh lows of 0.7043 and Aussie$ rallies remain weak. Immediate demand at 0.7030 and 0.7000 with sellers poised around 0.7065, 0.7080 and 0.7100 still. USDCAD has rallied further to 1.2995 helped by softer oil prices and ongoing detail to be sorted on the new NAFTA/USCMA trade deal and remains underpinned for the moment.Sell interest nearby at 1.3000 and 1.3050-60 with buyers now around 1.2960 1.29200 and 1.2900.
Fickle Forex markets ever prevailing, and US/Canad both on holiday today, so get your orders in to take full advantage of these moves.
The mighty Shrimpers of Southend United returned home to the hallowed Hall on Saturday but had to settle for a draw in the rain against bottom club Oxford. Disappointing but tempered by a nice sail on the Solent in the sun yesterday
Have a good week out there one and all.
Twitter: @MSPFX and @MikePatersonFX
Interbank Rate 07.52 BST GBPUSD 1.3088 EURUSD 1.1504 EURGBP 0.8789 GBPEUR 1.1377 USDJPY 113.81 USDCAD 1.2986 USDCHF 0.9914 GBPAUD 1.8544 GBPCAD 1.6998 GBPCHF 1.2977 GBPZAR 19.5755 GBPHKD 10.1471 EURHKD 8.9190