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  • Mike Paterson

Greenback grabbing still the name of the game

Wednesday 31 October 2018

It's been the theme of the week and the last 24 hours has been no different with month-end US Dollar demand prevailing, albeit with a small correction in European trading so far this morning.

GBPUSD survived a first test of the decent support/demand at 1.2730 but then failed at the now pivotal 1.2780 and tumbled back to post lows of 1.2697 with month-end EURGBP demand once again helping to cap the rally.Brexit concerns and early UK election talk still not helping quite apart from the general US$ buying. Sellers now poised into 1.2760, then 1.2780 and 1.2800 again with more around 1.2830 and the larger interest at 1.2850 and 1.2880 still then 1.2900.Immediate demand between 1.2720-30 with larger support I highlighted yesterday still between 1.2680-1.2700. A decent line building at 1.2700 this morning but I remain a GBP bear and rally seller with the strategy continuing to work well.

EURGBP duly rallied further on the usual month-end Bundesbank demand/expectation (a reminder that the BUBA buy Euros for the UK's EU contributions) and posted highs of 0.8939 (GBPEUR down to (1.1187) before running out of steam. Sellers now poised between 0.8920-30 then 0.8950 still.Immediate bids/support now at 0.8900, then 0.8880 and 0.8860 again.I would expect the last of the month-end demand is almost done so I'm now happy to trade both sides having sold my longs with some on-going/potential pressure on the Euro also evident.

EURUSD has fallen to 1.1336 but rallied a little this morning to post 1.1360 with large option contracts rolling off at 1.1350 later.Bids/support still around 1.1330  then larger at 1.1330 and 1.1300 where both barrier option and expiry interest today expected to provide decent support as I've also been warning. Sellers poised now around 1.1360 still then 1.1375-80 ,1.1400, 1.1420-30 and 1.1450 still.

USDJPY yesterday duly failed at 113.00 and fell back to 112.70 before bouncing back strongly to post highs of 113.36.The very large option contract interest rolling off today at 111.60 is now out of the picture but has undoubtedly helped provide support this week along with talk of large month-end USD buying generally. Immediate sell interest now at 113.30 where option contracts roll off today as well as 113.80 with 113.50 offers in between.Immediate bids/demand at 113.00, 112.80 and 112.50 then 112.30 and 112.00 still. I remain a rally seller in principle buying back in the dips which worked well yesterday but happy now to keep my powder dry until we get month-end out the way. USDCHF has also edged higher again to post 1.0058, taking out the renewed 1.0030 sell interest in the process and remains underpinned as I've warned for a while now.with the EURCHF also finding support. Some bids now at 1.1380 again then 1.1350, 1.1330 and 1.1300 with sellers still poised at 1.1430 and 1.1450. USDCHF bids now at 1.0030 with larger at 1.0000 and 0.9980 with sellers poised now at 1.0060 then 1.0080-1.0100. Happy to trade both sides of the price action at the moment but preferring the dip buys still.

AUDUSD failed around 0.7120 and fell back to 0.7072 as sellers prevailed yet again helped by the general USD demand. Bids/support still at 0.7050 and 0.7030 with sellers poised around 0.7100 again then 0.7120 and 0.7150 still. I remain a rally seller for the moment. USDCAD still can't make its mind up and continues to trade tightly.Sellers still between 1.3150-60 and 1.3180-00 with buyers at 1.3100, 1.3080 and 1.3050 again.

Fickle Forex markets ever prevailing so get your orders in to take full advantage of these moves.

Have a good day out there one and all.

Interbank Rate 08.48 GMT GBPUSD   1.2747 EURUSD   1.1355 EURGBP   0.8908 GBPEUR   1.1225 USDJPY   113.07 USDCAD   1.3123 USDCHF   1.0036 GBPAUD   1.7978 GBPCAD   1.6721 GBPCHF   1.2791 GBPHKD   9.8827 EURHKD   8.8042


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