Forex pairs still ranging
Wednesday 26 May 2021
Groundhog Day again, and some, as FX pairs continue to range tightly amid the all the CB/inflation uncertainty.
Today Dominic Cummings, former chief adviser to Boris Johnson, testifies to a parliamentary committee and will be spilling a few beans from around 08.30 GMT. Let's hope the algos like the colour of some of the headlines to inject a bit of life into proceedings.
A reminder that Citibank's EOM USD flow signals point to a small net buy interest but with US and UK on holiday on 31st May we will anticipate a lot of the required flow to be conducted into Friday even though there will be a 4pm London fix on Monday. Month-end Spot value therefore will be traded today. Recent signals/forecasts have not been too accurate to say the least so take the info with due caution but forewarned always forearmed. A fdew options of note rolling off today too.
Jury on the Greenback still out so ignore the noise and, as always in these fickle times, be careful with your trading. Pick your preferred entry/exit levels and don't be greedy or over-analyze. Patience and discipline are key too of course,as highglighted perfectly by those post-FOMC moves yesterday.
GBPUSD: Rinse n repeat as we continue to range 1.4120-1.4220. EURGBP: Large option interest today helping to support as I warned yesterday alonmg with some general EUR demand still and helping to cap GBPUSD. Good two-way pips whatever your bias. GBPJPY: Underpinned at 153.80 still but sell interest at 154.30-50 again amid the variable risk sentiment.
I remain a GBP rally seller across the pairs but still not getting over greedy with expectation on the retreats.
EURUSD: A good hold of 1.2220 this time amid the general EUR demand and some decent option Put interest still but sellers poised around 1.2260 again as we continue to range. USDJPY: Capping above 109.00 again and re-sells duly place and some pips banked again in the retreat. Rinse n repeat.EURJPY: 132.00-10 now a decent base but sellers at 133.50 still poised.USDCHF: Still holding 0.8930 as EURUSD caps again and with SNB ever vigilant/helpful. EURCHF: Capped into 1.0980 still as USDCHF fell but some general EUR dip demand and SNB shadow keeping it underpinned.
AUDUSD: A good hold of 0.7730 with large option Puts interest again today as I have warned about here and some pips banked. 0.7780 broken but 0.7800 capping and re-sells duly placed again per ongoing strategy. USDCAD: Holding 1.2030 again but still capping at 1.2080 as we continue to range tightly with CADJPY impact still in play both side of the price along with fluctuating oil price and USD sentiment ofc.
Let's continue to be careful out there in all things. Staying safe must be our main priority still.
Interbank rates: 08.30 BST