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  • Writer's pictureMike Paterson

Fimer Euro on EU Summit hopes

Monday 20 July 2020

Day 4 of the extended EU Summit gets underway at 14.00 GMT but after an eventful/fraught week-end there's been some cautious optimism over an agreement/compromise for the Recovery Fund and that's brought some firmer tones to the Euro but any deal still not over the line. How much is already factored in to the price of EUR pairs remains to be seen.

Meanwhile Brexit trade talks continue today as well as all the usual COVID, US-China concerns so it remains a fragile scenario out there still but with markets generally in glass-half-full mode but with some softer tones to European equities as the week gets underway,

GBPUSD has been ranging still with some supply from the EURGBP rally to keep capped at 1.2600 but looks underpinned around 1.2520 for the moment. EURGBP remains underpinned helped by the EU Summit optimism but has failed above 0.9130 so far with sellers also poised around 0.9150 and now lower to test 0.9100 support but good demand at 0.9060-80 still. All eyes on the EU Summit outcome. Buy rumour/sell fact ? GBPJPY remains range-bound amid the variable risk and been down to test 134.20-30 again after failing into 135.00 but rallying now as Europe gets underway as core pairs find dip demand.

I stay poised to sell GBP rallies overall as my preferred side and buy back in the dips as ever but patience continues to be a virtue and entry level key as always. I still expect to continue seeing some dip demand but cross-flows, risk sentiment and Brexit will continue to see a mixed bag as we've been witnessing.

USDJPY failed around 107.50 again after holding below 107.00 once more and now down to 107.17 again as I type amid some softer risk/USD plays. Re-sells duly placed upstairs again. Rinse n repeat.EURJPY has found support around 122.00 yet again and rallied on the EU Summmit hopes but failing into 123.00. EURUSD found support on the Asia opening into 1.1400 where we also have large option expiries today and since rallied to fresh 4-month highs of 1.1463 amid the general EUR demnd. USDCHF failed around 0.9440 this time around again but supported now into 0.9380 as EURUSD rallies but with an underpinned EURCHF still with the SNB ever vigilant in the dips.

AUDUSD has failed above 0.7000 again but equally finding support into 0.6960-65 still while USDCAD has capped into 1.3600 again but equally finding support at 1.3550 amid the variable risk/oil price/USD combo.

Markets are ever-fickle but good two-way pips to be had so don't forget to contact me if there's areas of trading these markets or how to make best use of the order boards and expiries, that you might need some further help with.

I wish you a good week ahead and let's continue to be careful out there in all things. Staying safe must be our main priority still.

Interbank rates:  08.46 BST

GBPUSD   1.2570

EURUSD   1.1453

EURGBP   0.9109

GBPEUR   1.0977

GBPAUD   1.7987

GBPCAD   1.7080

GBPJPY   134.76

GBPZAR   20.9807

GBPHKD   9.7455

USDJPY   107.17

USDZAR   16.6820

EURJPY   122.76

EURCHF   1.0766

EURHKD   8.8782

AUDUSD   0.6990

USDCAD   1.3583

USDCHF   0.9400

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