• Mike Paterson

More of the same as another week closes

Friday 14 January 2022

Equity and commodity markets have had another wobble but still finding dip buyers and the Greenback remains soggy as the expectations of rate hikes/policy normalisation become fully factored in. Reports of BOJ considering rate tightening sent JPY pairs lower in Asia with USDJPY leading the way but some dip demand returning as equity markets rally as I type.

In the wake of further No.10 partying revelations GBP traders should still keep their eye on the developing storm regarding PM Johnson with the enquiry still in progress.Decent UK GDP data earlier helping to support the Pound this morning.

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: Capped at 1.3750 but 1.3700 now providing good support as we continue to range tightly and USD selling prevails.EURGBP: Still ranging with the strong 0.8330 support area underpinning again but equally still failing around 0.8360 and helping to underpin GBPUSD. Should continue to see good two-way buiness. GBPJPY: Some good two-way business yesterday but the 157.00-20 support now providing resistance as we test 156.00 a few times as USDJPY retreats further on the BOJ rumours and variable risk sentiment.

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: 1.1450 support now amid the softer USD tones and still squeezing some shorts but running into levels where we have some decent option interest today. Caution required still for both bulls and bears.USDJPY: Now capped at 114.00-20 after yesterday's steady retreat but holding 113.60 so far after the extended BOJ-led fall in Asia. Dip support with some JPY supply amid generally firm risk tones and option interest a little lower.

EURJPY: 130.80-00 support now history but 130.40 providing a line for the moment.Sellers lurking now at 130.80-00. USDCHF: 0.9100 now providing some support after the latest retreat pushed lower by EURCHF dropping further too but with the SNB shadow ever present. EURCHF: SNB ever vigilant but failing above 1.0500 still and now testing 1.0430.

AUDUSD: Failure above 0.7300 but a decent hold of 0.7260 in the retreat so far. USDCAD: Retreating further still to test the strong 1.2450 support that I highlighted yesterday amid the firmer oil/softer USD flows. Sellers poised 1.2525 still where we also have large option interest today.

Let's continue to be careful out there in all things. Staying safe must be our main priority still.

Interbank rates: 08.00 GMT

GBPUSD 1.3724

EURUSD 1.1453

EURGBP 0.8352

GBPEUR 1.1972

GBPJPY 156.17

GBPCAD 1.7128

GBPCHF 1.2500

GBPZAR 21.0250

GBPHKD 10.6918

USDJPY 113.78

EURJPY 130.43

EURCHF 1.0434

EURHKD 8.9299

AUDUSD 0.7284

USDCAD 1.2494

USDCHF 0.9102

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