US inflation data looms

Thursday 11 July 2024

In the ongoing topsy-turvey tight-ranging price action we've seen some USD selling return with JPY weakness still notable amid firmer risk appetite. The Pound has found good support in the dips again helped by hawkish BOE comments, GBPJPY demand still and then UK GDP data this morning.

Today brings the key US CPI data and also the weekly jobless claims that despite Powell's comments in his testimony this week will still have algos jumping around.

While the CB, political and USD second-guessing continues remember as always to identify your preferred risk reward levels and let the algos do their thing along with the natural and speculative flows especially in days like today with thin liquidity. Don't get greedy or over-analyse.

US equity markets remain underpinned while WTI rallied before capping at $82.20 and now testing $80.60-80 support in the retreat. Ever fickle for the moment and expected to range still. Gold has found some dip buyers again this time at $2370 and now testing $2385. Dip demand should remain but profit-takers/sellers still poised.

GBPUSD: Support coming in at 1.2790-00 again and now posting 1.2867 with GBPJPY dip demand once again helping to support along with yesterday's hawkish BOE comments and this morning's UK GDP data.More two-way expected as we continue to range. EURGBP: Falling amid the renewed GBP demand but holding 0.8420 so far after another a cap into 0.8460. ECB/BOE rate cut conjecture also in play still. GBPJPY: GBP demand and ongoing JPY supply driving it higher. Holding 206.50 then 207.00 in the retreat  but capping above 208.00 as I type. Sellers will remain poised but underpinned overall still for the moment.

EURUSD: Still holding decent support around 1.0800-10 but capping at 1.0840 again as we range tightly with large option interest also providing some supply. USDJPY: Support coming in at 161.25-30 this time on the JPY supply but failing at 161.80. MOF/BOJ intervention fears remain but not putting off dip buyers still.

Traders - For more detailed analysis across a larger number of FX pairs including market order flows and options expiries email mike@mspfx.co.uk