Jury out on the Pound but it's not looking good
Friday 16 November 2018
Further to my client update last night we've seen the Pound steady a little and bounce from its lows but the sorry Brexit saga is still very far from being resolved and there's talk that Cabinet member Gove could yet still resign after turning down.Added to that we also still have the very real threat of a no-confidence vote on PM May. Another lively day ahead for sure.
GBPUSD has now found support at 1.2740, and since at 1.2780, to post rebound-highs of 1.2835 as I type with no further Brexit fallout this morning so far and traders/algos covering some short positions.Immediate offers still around 1.2850, 1.2880, 1.2900, 1.2920 and 1.2950 then larger around 1.2980-00.Bids/demand at 1.2800 and 1.2780 now history as I type with reports of that no-confidence vote becoming a reality. More buyers/support between 1.2740-50, then 1.2720. Larger at 1.2700 still, then 1.2685, 1.2665 and 1.2650. Expect a few offers to now come in around 1.2800 and 1.2830. I remain GBP bearish overall and happy to jump on rallies then buy back in the dips while remaining core short, a strategy that continues to work well.
EURGBP has capped at 0.8889 (GBPEUR lows of 1.1250) and drifted back to 0.8855 (1.1294) this morning where it still sits. Buyers poised around 0.8850, 0.8830, 0.8800 and 0.8780 still with sellers now at 0.8880 where a decent line is forming, then 0.8900, 0.8920 and 0.8950 still.
EURUSD remains underpinned still helped by some softer USD$ sentiment and we've now been back up to 1.1368 again this morning.Bids/support now at 1.1330, 1.1300 (where large option contracts roll off today), 1.1280 and 1.1250 then larger at 1.1220 and 1.1200 with sellers at 1.1370, 1.1385, 1.1420 and 1.1450.
USDJPY had another wobble lower yesterday with risk-off Yen demand and GBP/JPY selling playing out but we held 113.00 and have been back up to 113.67 since.Immediate sell interest now at 113.50 and 113.65 then 113.80, 114.20 and 114.50 still with buyers poised at 113.20 then larger at 113.00 and 112.80 still. I remain a rally seller buying back in the dips.
USDCHF has mostly been tightly bound with variable risk and US$ sentiment but off its lows helped once again by some decent EURCHF dip demand. Bids/support now around 1.1400, 1.1380, 1.1350 and 1.1330 then 1.1300 with sellers poised now at 1.1450, 1.1480 and 1.1500. USDCHF bids now at 1.005, then 1.00030 and 1.000 still with sellers around 1.0080 still then 1.0100, 1.0120 and 1.0150 again. I'm still happy to trade both sides of the price action at the moment but preferring the dip buys.
AUDUSD has one again failed into 0.7300 but continues to find dip demand.Immediate bids/support now at 0.7250 then 0.7230 and 0.7200 where large option contract interest rolling off today with sellers lurking at 0.7300 still then 0.7320 and 0.7350. USDCAD has broken back down through 1.3200 and now testing 1.3150 amid some general US$ selling and firmer oil price. Bids now at 1.3150, 1.3120 and 1.3100 with sellers poised around 1.3185, 1.3200 then 1.3230 and 1.3250 again.
Fickle Forex markets ever prevailing so get your orders in to take full advantage of these moves.
Tomorrow sees the mighty Shrimpers at the hallowed Hall and returning to league matters and looking for a needed 3 points given recent results/disappointments. Bring it on!
Have a great week-end out there one and all.
Twitter: @MSPFX and @MikePatersonFX