Firmer US Dollar tones still but jury remains out
Friday 12 November 2021
The Greenback remains underpinned as another week comes to a close but the jury is out now on whether the trend continues or has run far enough for the time being as we trade tightly again following the week's decent moves.
Equity markets and yields still firm overall, as is oil, albeit off their highs again this morning while JPY and CHF demand still notable too albeit with those cross pairs off their lows. Gold steady too reflecting some risk aversion amid all the CB uncertainty and as COVID continues to cast its ugly shadow.
Don't forget in these markets that it's key to identify on-going and new ranges and trade the momentum if broken but not getting greedy if they stay intact. Second-guessing is often futile. All things/moves must be considered in context. Forex is not rocket science but it is ever-fickle so you have to stay in control of you/your trades as much as you can.
GBPUSD: New lows testing the 1.3350-55 support after yesterday's rally failure into 1.3420-25 amid the USD demand. Pips banked along the way in the retreat per ongoing strategy and tweets with some core shorts kept as a USDJPY hedge still.Good size options today in play should we break 1.3335-50. EURGBP: Holding 0.8540 still but remains tightly bound with sellers poised into 0.8580 as core pairs move in tandem still. GBPJPY: The support between 152.50-70 finally broke but dip demand into 152.35 as core pairs find support at 113.80-00 and 1.3350.Rally sellers remain poised though amid the variable/fragile risk tones.
I remain a GBP rally seller across the pairs overall as my preferred trading side albeit against the grain currently so being patient as ever. These markets are ever-fickle so good/tight position management essential.
EURUSD: Support at 1.1430 now halting the week's decline but the bounce has been lss than impressive so far amid the general USD demand and cross-flow action. USDJPY: Looks underpinned still at 113.80 but equally sellers at 114.25-30 capping the latest rallies. Large options in play too at 114.00. EURJPY: 130.50 currently providing support after the cap into 130.80 with rally sellers ever poised. USDCHF: 0.9220 resistance now broken and support coming in at 0.9200 with the SNB ever vigilant but equally sellers into 0.9240 still poised. EURCHF: 1.0530-40 still providing support with the SNB ever vigilant but those sellers in the rallies between 1.0560-80 still prevailing .
AUDUSD: 0.7280 providing good support with some good size bids down there but rally sellers poised into 0.7320 still. USDCAD: 1.2550 now forming a good base as the pair continues to rally amid the generally firmer USD tones but some CADJPY supply too as oil caps. Large option interest today should we retreat but alrEady probably done its job in the drive higher over past 48 hours.
Have a great week-end everyone. Let's continue to be careful out there in all things. Staying safe must be our main priority still.
Interbank rates: 08.05 GMT