Tuesday 13 February 2024
Some USD demand still overall with USDJPY underpinned still producing more JPY supply in the cross-flows and underpinning core pairs. Good two-way business though in the last 24 hours albeit ranging tightly still with market focus on fresh US CPI data at 13.30 GMT as the second-guessing continues. NZD inflation came in under expectations and gave a jolt to those looking for rate hikes. Same story out of Switzerland but the Pound has found a little support on UK jobs/waghes data this morning.
The Ukraine/Russia war and Middle East Israel/Hamas/Houthi/Hezbollah/Red Sea tensions are all still casting their own shadow. While all the uncertainty remains, both economical and geopolitical, remember to identify your preferred risk reward levels and let the algos do their thing along with the natural and speculative flows. Don't get greedy or over-analyse.
Equities remain underpinned overall but in retreat as European trading gets underway with some profit-taking ahead of the US CPI data. WTI has tested $77.25 again after rallying from $76.80 amid supply concerns still and holding there again this morning in the retreat. Gold slightly softer and capping at $2025-30 now but holding $2015 in the retreat as we continue to range tightly.
GBPUSD: Capping into 1.2660 still after holding 1.2600-10 again as the USD jury remains out but support coming from some GBPJPY demand still. I remain poised for further sells when momentum fades as we continue to range. EURGBP: Capping at 0.8535 but holding 0.8510 in the extended retreat so far with Pound demand notable again on data and GBPJPY demand but the BOE/ECB debates continues. GBPJPY: Holding 188.50 now but capping at 189.30 in the extended rally so far with JPY supply notable. Sellers will remain poised but underpinned still for the moment.
EURUSD: Support at 1.0750-60 still but capping at 1.0780 yesterday and this morning as we continue to range. I remain a rally seller. USDJPY: 149.00 support area tested again yesterday but held overall to rally and post amid the USD demand/JPY supply double-whammy. I remain a rally seller as preferred side overall given that the BOJ still don't want this racing away too far but dip demand still notable for the moment.
For more detailed analysis across a larger number of FX pairs including market order flows and options expiries email mike@mspfx.co.uk
Interbank rates: 08.48 GMT
GBPUSD 1.2644
EURUSD 1.0769
EURGBP 0.8517
GBPEUR 1.1740
USDJPY 149.57
GBPJPY 189.13
GBPCAD 1.6988
GBPCHF 1.1139
GBPZAR 23.8143
GBPHKD 9.8465
USDCHF 0.8808
EURCHF 0.9486
EURHKD 8.3871
AUDUSD 0.6515
NZDUSD 0.6104
USDCAD 1.3456
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