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  • Writer's pictureMike Paterson

Markets still second-guessing as US CPI data looms next week

Friday 10 February 2023

Yet another 24 hours of mixed sentiment for the Greenback as the central bank second-guessing continues. All very tightly bound still as the week draws to A close with market focus definitely looking toward next Tuesday's US CPI data. JPY demand notable again amid softer risk tones but primarily reports that the BOJ are looking to appoint Ueda as the next Governor after Amamiya has reportedly turned the job down but JPY supply returning in rapid fashion as I type after the over-reaction. UK GDP data this morning sees recession technically avoided but economy still soggy.

Equities have steadied after another reversal while WTI has had a good rally from $77.50 again and now through the $80.00 resistance/offers to post $80.20. Gold has held $1850 but still tightly bound amid the uncertainty. Ukraine/Russia war continues to be the elephant in the room amid other geo-political risk and Zelensky is ramping up the pleas to get further support from the UK/Europe. BOE's Pill and ECB's Schnabel speaking at 14.00 GMT then Fed's Waller at 17.30 GMT. US Michigan Consumer Sentiment at 15.00 GMT might shake the algos up given the current data paranoia.

GBPUSD: Testing 1.2200 yesterday amid the USD supply and some re-sells duly placed part hedged again versus USDJPY shorts. Pips gratefully banked into 1.2100-20 but a further retreat helped by GBPJPY supply has seen a good hold of 1.2080. I remain a rally seller. EURGBP: Capping now at 0.8875 as GBPUSD rally outstrips EURUSD but support at 0.8840-50 still.Expect some more two-way trading. GBPJPY: Capping at 159.50 before the BOJ news-led fall with JPY notable across the board but holding 157.50 this time and a good bounce as core pairs find dip demand after the over-reaction. Sellers poised still.

EURUSD: Holding 1.0710-20 again as I type after capping into 1.0800 yesterday as the jury remains out . I remain a rally seller as preferred side still. USDJPY: Capping into 131.80 again yesterday and a solid retreat on the BOJ Gov news but holding the old support around 129.75-80 and now bouncing back to 131.25 as I type in rapid fashion. Rinse n repeat for the moment with the USD jury out

Plenty more to read in my full report and more detailed update for traders plus my 1-2-1 mentoring sessions. Mail for more info.

Interbank rates: 07.45 GMT

GBPUSD 1.2104

EURUSD 1.0736

EURGBP 0.8869

GBPEUR 1.1274

USDJPY 130.81

EURJPY 140.42

GBPJPY 158.32

GBPCAD 1.6251

GBPCHF 1.1168

GBPZAR 21.5202

GBPHKD 9.4337

EURCHF 0.9900

EURHKD 8.3677

AUDUSD 0.6938

NZDUSD 0.6333

USDCAD 1.3443

USDCHF 0.9220

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