Friday 2 June 2023
Some USD selling notable yesterday amid better risk tones and helped by US Fed's Harker accelerated the rate hike pause/skip speculation at June's FOMC meeting as markets wait on today's key US jobs/wages data at 12.30 GMT. Softer inflation tones small print in yesterday's US ADP data despite stronger headlines also added to the negative bias. Comments from BOJ Gov Ueda overnight didn't add anything new but have kept the YCC guessing game in focus too.
Equities rallied strongly and WTI has also broken back up through $70.00 but capping at $71.00 so far amid the ongoing global economic growth concerns and OPEC+ meeting this weekend. Gold also enjoyed a decent rally into $1985 despite the firmer risk tones with $1950 support now again as the jury remains out. Increasing tensions in the Ukraine/Russia war continue to be the elephant in the room along with US/China tensions as the world remains a fragile place. Serbian unrest adding to the uncertain picture too.
GBPUSD: Yesterday's hold of 1.2450 has seen a solid rally into 1.2550 amid the USD supply and some re-sells duly placed up here. I remain a rally seller. EURGBP demand returning but tempered by some GBPJPY demand helping to support.
EURGBP: Capping at 0.8600 this time after a good hold of 0.8570-80 amid generally firmer/proft-taking EUR tones. Sellers still poised. GBPJPY: Capping at 174.20 yesterday and this morning after a good hold of 173.50. Sellers ever-poised when risk appetite softens but some demand expected too for the moment.
EURUSD: A solid rally through 1.0700 amid the USD supply and some ECB rate hike conjecture but capping around 1.0780 so far now. I remain a rally seller as my preferred side. Options in play today if we retreat. USDJPY: A further retreat amid the general USD selling before finding decent support once more, this time around 13850.I still prefer to sell rallies/be long JPY overall.
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