A mixed bag for markets as the week progresses
Wednesday 6 February 2019
We're seeing a mixed picture again as the jury remains out on a number of key issues. Some USD strength overall but it's not quite that simple. Last night's State of the Union speech from Trump left traders and algos suitably nonplussed too.
Meanwhile Brexit remains in the headlines with May holding talks with the DUP to discuss the Irish backstop.Yesterday's key Services PMI (the sector counts for over 80% of UK GDP) came in much weaker than expected following on from the softer Manufacturing and Construction data that preceded it.
GBPUSD has been trading softer again and fallen through 1.3000 after failing to rally back above 1.3050 to post fresh recent lows of 1.2926 where some decent support lays waiting. EURGBP has taken full advantage of the softer Pound and been up to test 0.8820 (GBPEUR 1.1338). I remain GBP bearish overall but we will be cautious of Brexit headlines both sides of the coin.
EURUSD has now also fallen through some decent support/bids at 1.1400 that I highlighted to test next support lines around 1.1380 while USDJPY has fallen back a little to 109.56 this morning as the decent 110.00 sell interest starts to filter through and helped by some softer risk sentiment/JPY demand.
USDCHF remains underpinned with EURUSD still fragile and EURCHF finding dip demand and the SNB ever-watchful.
Yesterday's rally on AUDUSD that I mentioned proved shortlived with by RBA governor Lowe offering more dovish tones and triggering a rapid fall through 0.7200 to post lows of 0.7123.USDCAD has been on the march higher having formed a base at 1.3120 and tested 1.3200 this morning helped by some CAD/JPY selling and retreating oil prices.
Fickle Forex markets ever prevailing so be ready with your entry/exit levels and orders as always.
Have a good day one and all.
Interbank Rate 08.40GMT