Greenback grabbing returns
Friday 11 March 2022
ECB have met, announced and the jury remnains out after initial hawkish tones from an unchanged rate decision brought some more cautious deliberation and comments amid the the larger Ukraine backdrop concerns. The Euro saw a headline spike but has since settled lower as we see notable US Dollar demand returning.
Eequity markets remain underpinned while gold and oil remain off their heady highs at the start of the week but equally finding dip demand too as the uncertainty continues. Now $1992 from $1981 and $110.50 from $105.60 lows. Forex pairs continue their fragile range trading price action.
For new and older subscribers alike I will repeat my view that it's still a case of not over-analysing amid all the noise but keeping your focus on price action in core and cross-pairs. I can't tell you what's going to happen next but continue to identify ranges and what levels present value for money. Algos will continue to knee-jerk price action on the variable headlines. Discipline is key in these whippy markets. If in doubt, stay out or at the very least keep positions trimmed/manageable.
GBPUSD: Finding a cap above at 1.3100 now amid the USD demand but finding support at 1.3050 as I type and some re-sell pips banked. EURGBP: Decent support now at 0.8380 again after the post-ECB failure above 0.8430 with sellers poised up there as I warned.GBPJPY: Bouncing from 151.80 yesterday and now 152.50 this morning and testing that 153.00 resistance again while the jury remains out.
EURUSD: A post-ECB spike to test those 1.1125-30 offers but a solid retreat since helped by the USD demand but also general EUR/ECB disappointment too.USDJPY: 116.20 now supporting after yesterday's break through as the steady risk/USD demand combo keeps momentum ticking higher to post levels not seens since 2017. EURJPY: Support again at 127.80 with failure into 128.60 in the latest rally in these ever fickle times. USDCHF: Now holding 0.9290 in the latest retreat and testing 0.9320 with EURCHF support into 1.022 with SNB shadow lurking amid the fragile backdrop.EURCHF: Support now at 1.0200 after 1.0300 highs post-ECB with SNB lurking in the dips. Rally sellers poised still though.
AUDUSD: Holding 0.7315 as I type after failure above 0.7360 amid the firmer USD tones. USDCAD: Capping at 1.2800 now but holding 1.2750 a few times too amid the variable oil price, risk and USD tones with option interest in play there too.I still think we'll see some two-way business amid all the uncertainty.Caution required though with so many variables.
Let's continue to be careful out there in all things. Staying safe must be our main priority still. Have a peaceful week-end everyone.
Interbank rates: 08.35 GMT