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  • Writer's pictureMike Paterson

Some calm returns but fragile times continue

Monday 16 October 2023

Risk sentiment melted again on Friday amid the Middle East and that helped to underpin the Greenback again but cap JPY and CHF crosses and therefore core pairs plus we saw sharp rallies in Gold and Oil but steadier in Asia and early Europe albeit amid mixed political signals out of the ME.

NZ elections saw Christopher Luxon's centre-right party triumph as expected and hence bring in a change of government which gave NZD a little lift. Not much on the calendar today but Fed's Harker and BOE's Pill up to the rostrum.

Equities fell sharply in NY trading amid the wobbyl risk tones with focus on the Middle East but steadier in Asia and since. WTI found support around $81.00 then $83.00 in its latest retreats and has rallied amid supply concerns to resistance at $86.80-00 with the jury still out amid the uncertain global economic picture too. Gold found support around $1865-70 again and rallied sharply to look at $1930-35 amid the fragile risk but with natural sellers ever poised still. 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: Capping around 1.2220 and another decent retreat into 1.2120 on Friday amid the USD demand and GBPJPY/GBPCHF supply. I remain poised for further re-sells when momentum fades. EURGBP: Still locked in to tight 0.8635-75 range. More two-way business expected as core pairs fluctuate. GBPJPY: Holding 181.20 in Friday's retreat amid the softer risk tones but capping at 182.20 so far with rally sellers ever poised still.

EURUSD: The old 1.0500 support area holding the extended retreat on Friday and where we also some ongoing option interest but capping at 1.0540 so far. I remain a rally seller overall. USDJPY: 149.35 holding so far helped by some better risk JPY supply but rallies capping around 149.65 this time with MOF intervention fears still there. I remain a rally seller as preferred side overall at these elevated levels but with patience a virtue as ever.

More detailed analysis across a variety of pairs and 1-2-1 mentoring sessions for traders from

Interbank rates: 08.38 BST

GBPUSD 1.2175

EURUSD 1.0528

EURGBP 0.8648

GBPEUR 1.1560

USDJPY 149.55

GBPJPY 182.00

GBPCAD 1.6605

GBPCHF 1.0982

GBPZAR 22.9710

GBPHKD 9.4804

USDCHF 0.9041

EURCHF 0.9517

EURHKD 8.2011

AUDUSD 0.6322

NZDUSD 0.5923

USDCAD 1.3644

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