More of the same
Wednesday 23 November 2022
It continues to be a quiet week shortened by the US Thanksgiving holiday beginning tomorrow and we're still seeing some tight FX ranges albeit with a general USD-supply bias. Suffice to say there's not a lot more I can add to enlighten at this time.
Equities, oil and gold all trading off their lows again, as are cryptos this time. Geopolitical risk in Ukraine still lurking too and while it may be a quiet week on the Central Bank front we have a few CB speakers up to the rostrum at various times and the FOMC Minutes later. Still not a lot on the options front either atm.
As always though we should expect the unexpected and not get complacent. Remember that conjecture and second-guessing should stand to one side on data and news releases. Focus on the price action and let the algos do the heavy lifting/dropping. The important thing is to identify your preferred risk/reward entry/exit levels prior.
GBPUSD: A good hold of 1.1850-70 now with GBPJPY demand returning and EURGBP retreating off 0.8700 but capping at 1.1935 so far. EURGBP: Capping at 0.8700 again after a solid hold of 0.8630-35 yesterday. I expect the two-way business to continue as jury remains out on both currencies and outlook. GBPJPY: Holding 167.75 in the latest retreat amid core pair dip demand and better risk tones.
EURUSD: A decent hold at 1.0280-00 this time amid the softer USD tones but reversing back into 1.0300 as I type having capped into 1.0350 on some general EUR supply. Large option interest at1.0300-10 today too. Should still see some mixed business. USDJPY: Good demand into 141.00 yesterday and since, and some pips gratefully banked. EURJPY: Capping at 146.15 and in solid retreat this morning amid the EUR supply to 145.65. Expect more two-way business. USDCHF: 0.9500 providing strong support with more options interest there today after a good cap at 0.96560-80 amid the softer USD tones and ongoing CHF demand overall. EURCHF had a further wobble but bouncing again and helping to keep USDCHF underpinned too. SNB ever-vigilant. EURCHF: A decent retreat into 0.9760 yesterday once 0.9800 broke amid the sofer EUR tones/CHF demand double-whammy I highlighted but strong bounce to 0.9830 as USDCHF finds that good demand around 0.9500. No FX pair is an island.
AUDUSD: Holding 0.6630 this time amid the softer USD tones but equally finding sellers into 0.6680 again amid ongoing China COVID concern and potential RBA hike slowing.NZDUSD supported at 0.6130 now but capping at 0.6200 where we also found sellers prevailing last Friday. USDCAD: Capping at 1.3420 yesterday amid oil prices basing but 1.3360 holding the retreat again. I think we'll see some two-way business still overall as markets remain ever-fickle.
Let's continue to be careful out there.
Interbank rates: 08.50 GMT