Markets underpinned still but good two-way FX business
Thursday 30 December 2021
Equity and commodity markets have been in bullish mood still through the Xmas period but we've seen some good two-way business in Forex markets to round off the year amid the reduced liquidity/ potentially increased volatility into New Year.
As always, don't over-analyze or second-guess but keep your focus on price action in core and cross-pairs and identify recent ranges to see whether we hold or break and what levels present value for money. Patience will invariably be a virtue but don't confuse patience with being stubborn.
GBPUSD: The steady rally continued helped by risk-on GBPJPY demand/EURGBP supply and we saw a test of 1.3500 but has retreated to 1.3460 with support coming in now between 1.3420-30. GBPUSD rally sellers, including me, ever poised while keeping one eye at least on the cross flows and risk sentiment. EURGBP: Support at 0.8400 (GBPEUR resistance 1.1900) now broken amid the firmer risk EUR supply and GBPJPY demand. All helping to underpin GBPUSD still. Sellers now lining up 0.8420-25.GBPJPY: 15460-80 now a decent support area amid the ongoing better risk tones and underpinned USDJPY. Sellers remain poised on this and core pairs when momentum fades but caution still required for the moment.
I remain a GBP rally seller across the pairs overall as my preferred trading side but being patient as ever. These markets are ever-fickle so good/tight position management essential.
EURUSD: 1.1300 now providing support after a failure around 1.1360 amid the better risk tone EUR supply generally. USDJPY: Good support at 114.70 now after breaking up through 114.50 amid the general JPY supply and currently holding above 115.00 as I type.EURJPY: 130.00 support now but sellers poised around 130.60.USDCHF: Pressure on EURCHF helping to cap this pair but support coming in at 0.9130 after the failure at 0.9200. but with the SNB ever vigilant. EURCHF: A dip below 1.0365 amid the general EUR supply but talk of SNB bids around 1.0370 helping to support this latest fall for the moment.
AUDUSD: 0.7200-20 support still amid the risk-on AUDJPY demand and firmer gold/commodity prices but failing at 0.7270 so far. USDCAD: Support coming in at 1.2770 after failing at 1.2830 amid the risk-on CADJPY demand but oil price retreat since now sees 1.2810 posted again.
Let's continue to be careful out there in all things. Staying safe must be our main priority still.
Interbank rates: 08.55 GMT