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  • Mike Paterson

Markets digest latest news but still going nowhere fast

Thursday 26 July 2018

The US-EU trade talks ended better than most had feared but this seems to be a Trump trend now. Lots of blather and nationalistic rhetoric prior then plenty of compromise at the meeting vis-a-vis China, UK and most recently Russia. Today's focus is on the ECB's latest interest rate decision and press conference.

GBPUSD has broken up through 1.3214 as traders cover a few more short positions but equally has run into fresh sellers up there, including yours truly, as I advised yesterday. 1.3220-30 remains a decent line in the sand. Immediate support/buying interest now around 1.3175 then 1.3150, and 1.3130 1.3100 still.Sellers poised around 1.3200 then 1.3220-30 and 1.3250 still.Keep selling the rallies but respect the dip demand as I warned again yesterday. Still tightly bound in real terms.

EURGBP has remained on the back foot with the Pound demand but unable to break down far through the 0.8875-80 support area (GBPEUR resistance 1.1265)as we head into the usual month-end buying with the latest ECB interest rate/monetary policy decision today also in the mix. Sellers still poised around 0.8900, 0.8930 and 0.8950 then larger between 0.8980-9000. Buyers between 0.8870-80 still, 0.8850, 0.8830 and 0.8800. Keep buying the dips.

EURUSD has understandably still been treading water with the ECB looming and with large option contract expiries once again today at 1.1700 and 1.1730-40.Buyers lined up around 1.1680 then 1.1650-60 still and larger at 1.1620 with more into 1.1600 and 1.1580. Sellers poised around 1.1730 then 1.1750 and 1.1780-1800.Not a lot expected from Draghi & Co but we know never to say never to some volatility around the 12.30 GMT press conference nonetheless. The algos will pick up on any wayward headlines.

USDJPY is also still tightly bound but lower on general US$ supply.Buyers now into  110.50 then 110.30 and 110.00.Sellers poised around 111.00 then 111.50 with larger interest between 111.80-112.00. USDCHF remains underpinned at 0.9900 but still finding sellers poised on the rallies and in EURCHF too.

AUDUSD has broken up through 0.7450 on general commodity strength and softer US% but has run into sellers again with 0.7480 proving a step too far amid more PBOC action. Buyers now at 0.7420 with more at 0.7400 then 0.7350 0.7320 and 0.7300 still where a barrier option defence is expected. Immediate sell interest now at 0.7450 then 0.7480-0.7500. USDCAD finally made its mind up and has headed sharply lower to 1.3024 also on the softer US$/firmer commodity price double whammy. Sellers now into 1.3060 1.3075,1.3100 and 1.3120 with buyers poised at 1.3020, 1.3000, 1.2980 and 1.2960.

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

Have a good day out there one and all.

Interbank Rate 09.45 BST GBPUSD   1.3176 EURUSD   1.1712 EURGBP   0.8888 GBPEUR   1.1249 USDJPY   110.73 USDCAD   1.3047 USDCHF   0.9928 GBPAUD   1.7737 GBPCAD   1.7192 GBPCHF   1.3083 GBPZAR   17.3868 GBPHKD   10.2153 EURHKD   9.0811


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