More fun and games as markets continue second-guessing
Friday 3 February 2023
The BOE & ECB both duly delivered 0.5% hikes but some dovish tones from Bailey & Co while Lagarde and the ECB were less than convincing in their trying to remain hawkish with obvious cracks appearing from the rhetoric. Both cases that I expected and wrote about so I hope the steer helped. Lots of fun and games since with the Pound understandably taking another hit and the Euro getting a reality-check sell-off but still outperforming its former room mate across the English Channel.
Equities are off their highs again and in retreat again as I type while WTI has found a strong cap at $77.00 now but holding $75.15-25 so far. Gold once again failed above $1950-60 but now forming a base at the strong $1900-10 area. Ukraine/Russia war continues to be the elephant in the room amid other geo-political risk. US NFP data today will add to the FOMC hype and keep markets guessing.
GBPUSD: Holding 1.2180 support as I type per my tweet earlier after capping again into 1.2400 on the algo-led knee-jerk on rate hike headline. EURGBP demand and GBPJPY supply helping to undermine GBPUSD still. EURGBP: Strong rally again after holding the 0.8880 pivot area yesterday and helping to cap GBPUSD as EURUSD retreated too but lagging on the CB dfferenttials. Looking underpinned still .GBPJPY: Finding support around 156.75 after capping at 159.50 in the post-BOE knee-jerk higher amid the generally soggy GBP tones and JPY demand amid the bond/equity market uncertainty
EURUSD: I wrote this yesterday... "some re-sells duly placed above 1.1000 but market still has a few bids in the dip amid hawkish ECB expectations. I'm not convinced and poised to re-sell if ECB disappoints the hawks." Et voila! A decent drop to test 1.0880 support. I hope the steer helped. Option interest in play if we rally. USDJPY: A hold of 128.00-05 yesterday but equally failing above 128.75-00 now.
Plenty more to read in my full report which you can receive by emailing firstname.lastname@example.org. Also for details on my 1-2-1 mentoring services for traders and my market strategies across a number of pairs each day.
Interbank rates: 08.22 GMT