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  • Writer's pictureMike Paterson

Good two-way business returning

Tuesday 6 October 2020

Trump returns from hospital and after some privileged health care says COVID is nothing to worry about.We have to be our own judges of that I reckon.Markets have seen a generally optimistic start to the week though also helped by higher hopes for more US monetary stimulus with another meeting planned for today.

This thirst for a further cheap money fix to feed the ongoing addiction may well be the current play but I still say the overall picture remains fragile. No point being stubborn or greedy though if trading against the trend as per my tweet yesterday.

ECB's Lagarde speaking at 08.35 and 13.00 GMT then Lane at 15.30 GMT and Fed's Powell at 14.40 GMT all in an online event. More Fed speakers lined up until 22.00 GMT so we can expect a few headlines. Whether we get anything to fire up the algos remains to be seen.

GBPUSD found a base at 1.2940 then that decent resistance line at 1.2960-70 became support with GBPJPY demand notable on the better risk tones. 1.3000-10 still remains a decent cap though helped by some decent option expiry interest today. EURGBP has been tightly bound 0.9060-90 with EURUSD rallying in line with GBPUSD this time underpinned by EURJPY and EURCHF demand. GBPJPY currently falling back from 137.44 to test the pivotal 137.00 area amid some softer risk tones as I type but should still find some demand in the dips.

I stay poised to sell GBP rallies as my preferred side and buy back in the dips as ever. Patience continues to be a virtue and entry level key as always. I still see dip demand though with markets still in a state of uncertainty overall.

USDJPY has failed above 105.70 again and re-sells duly placed as per my update here yesterday but demand at 105.50 atm. EURJPY also turning a little lower as I type on the softer risk tones and core pair rally sell interest. EURUSD saw a decent rally on the better risk tones but finding 1.1800 a step too far again with some large option interest there today too.USDCHF failed at 0.9180 as EURUSD rallies but has held 0.9130 so far as EURUSD retreats with EURCHF steady as SNB casts its shadow still.

AUDUSD had a spike above 0.7200 as the RBA left rates on hold as expected but has since seen a retreat into 0.7150-60 helped by some AUDJPY supply.USDCAD failed into 1.3300 and has retreated to 1.3245 but rallying again to 1.3270 as I type amid the variable risk/oil price.

Markets are ever-fickle so don't forget to contact me if there's areas that you might need some further help with.

Let's continue to be careful out there in all things. Staying safe must be our main priority still.

Interbank rates: 08.42 BST

GBPUSD 1.2991

EURUSD 1.1782

EURGBP 0.9068

GBPEUR 1.1024

GBPAUD 1.8157

GBPCAD 1.7228

GBPJPY 137.25

GBPZAR 21.6190

GBPHKD 10.0711

USDJPY 105.67

USDZAR 16.6711

EURJPY 124.48

EURCHF 1.0777

EURHKD 9.1357

AUDUSD 0.7152

USDCAD 1.3265

USDCHF 0.9150

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