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  • Mike Paterson

Markets second guessing and ranging 

Tuesday 17th January 2023

The Bank Of Japan are very much still in focus for their latest policy meeting now underway with the decision tomorrow and as markets keep second-guessing the variables on Yield Curve Control change we're ranging tightly but with some USD demand still notable in the dips. With Kuroda stepping down soon the new BOJ Governor is due to be nominated on/by February 10.

Equities and WTI are still making their minds up too as I type with the latter finding support around $78.75 but equally some decent resistance into $80. Gold has slipped a little further amid the general USD dip demand but ranging $1900-20 still for the moment. Ukraine/Russia war continues to be the elephant in the room amid other geopolitical risk. UK jobs and wages data this morning presented another mixed picture with wages still lagging and markets will look at CPI looming tomorrow for further BOE clues. US trading returns today after their long weekend. NY Fed head Williams speaking at 20.00 GMT.

GBPUSD: Tight ranging again so two-way business whatever you preference and now capping into 1.2230 but holding 1.2180.I remain poised to re=sell per ongoing strategy.Keep in mind that whatever the outcome on BOJ tomorrow we can expect this pair to be impacted by the subsequent GBPJPY moves. EURGBP: 0.8850 area providing good support yet again but capping into 0.8890 this time as core pairs make their mind up. GBPJPY: Finding support at 156.25-30 as core pairs find dip demand but rallies tempered by the fragile risk and BOJ unknowns.

EURUSD: Underpinned at 1.0800 now but running out of steam at 1.1840 so far amid the tight ranges generally.USDJPY: Solid hold of 128.25 in yesterday's dip but equally failing above 129.00 as the jury remains out on BOJ. Now testing 128.50 again in the latest retreat. EURJPY: A hold of 138.80 this time but unable to climb over 139.50 as we continue to see good two-way business ahead of BOJ. USDCHF: Some CHF demand notable again as markets pause with EURCHF also retreating further.Still holding the 0.9220-30 support line after failing into 0.9280 again. EURCHF: Further sell interest prevailing after last week's over-extended rally and capping now at 1.0040 now to test the support/bids lining up at 1.0000 as I type. SNB will be ever vigilant.

AUDUSD: Good hold of 0.6940 but equally sellers prevailing at 0.6980 as we range tightly. Still Keep an eye on AUD crosses for further clues particularly AUDJPY in next 24 hours. NZDUSD: Support coming in at 0.6375-80 now and testing 0.6420 again. USDCAD: Holding 1.3380 yesterday on the firmer USD/softer oil double whammy but capping above 1.3420 again. Expect more two-way business amid the USD/oil variables.

Traders can take advantage from my daily emails,(far more detailed than this summary aimed at my physical delivery clients), plus 1-2-1 mentoring sessions. for more details.

Interbank rates: 08.05 GMT

GBPUSD 1.2222

EURUSD 1.0833

EURGBP 0.8862

GBPEUR 1.1282

GBPCAD 1.6393

GBPCHF 1.1289

GBPZAR 20.8645

GBPHKD 9.5232

USDJPY 128.47

EURJPY 139.21

EURCHF 1.0002

EURHKD 8.4411

AUDUSD 0.6971

NZDUSD 0.6405

USDCAD 1.3400

USDCHF 0.9232

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