Cautious start to the new week
Tuesday 19 February 2019
Still a lot of noise going on re Brexit, US/China trade, US/Mexico wall funding et al and as another week gets underway in these ever fickle FX markets we're seeing tight ranges as the jury remains out still. I'll say again we are in fragile times and the markets will respond accordingly. US and Canada back from a day off might offer some increased action but plenty of second-guessing still.
GBPUSD has been tightly contained as expected per my update yesterday and underpinned by some GBPJPY demand. EURGBP has also been tightly bound.
I remain GBP bearish overall and continue to rally-sell.No change as far as I'm concerned right now.The latest Brexit concerns only adding to a growing realization that the UK is under the cosh in the short term whatever the final outcome. Data risk today comes in the form of latest UK wages/jobs data and as ever it's the wages component that will excite the algos if wide of the mark. Remember though that recent inflation data came in softer and that will help balance the discussion if today's numbers also come in below expectations. The reverse being true also though re any potential shift in interest rates.
EURUSD has also been biding time amid the current lack of action and we should continue to see some two-way business at these indifferent levels.USDJPY has found some support in Asia after BOJ governor talked about possible further easing if needed but nothing new there there.
USDCHF remains underpinned but seeing sell interest around 100.60 still with some EURCHF supply again but tightly bound.while AUDUSD had a little wobble earlier on what were essentially dovish RBA Minutes but still unclear. USDCAD continues to trade tightly amid the current uncertainty. Good two-way business still.
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 07.57 GMT