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  • Mike Paterson

Moving markets still

Wednesday 27 April 2022

Wobbly risk tones overall still but with the volatility comes some extended FX moves and reversals amid general USD demand helped by month-end flows that I've been warning about all week. I hope the steer has helped.Today sees the month-end FX Spot date fix so be aware into the 16.00 BST London settlement.

USDJPY therefore seeing an underlying USD demand versus risk-off JPY demand too providing great two-way business. EURUSD has hit 5 year lows below 1.0700 while GBPUSD also continues it journey south to post fresh lows of 1.2542 this morning, not seen in almost 2 years. AUDUSD off its fresh lows after CPI data seemed to nail on a 0.25% rate hike next week.

Equity markets making their minds up but but off their lows this morning after another tumble but some better risk tones now which has seen JPY and CHF supply return too for the moment helping to support core pairs. Gold and oil both off their lows but sellers poised amid the uncertainty.

GBPUSD: Broken down through 1.2600 then 1.2550 this morning amid the general USD demand and more pips banked per my tweet and now back up to 1.2580. I remain a rally seller overall while keeping an eye on EURGBP and GBPJPY as always. EURGBP: A hold of 0.8420 this time but failing above 0.8460 as the two-way business continues with both GBP and EUR battling it for soggiest currency. Expecting dip demand still but equally rally sellers poised as the uncertainty continues. GBPJPY: Support at 159.50 after the breakdown through 162.00 then 160.00 as the JPY risk-off demand saw both core pairs in retreat but some dip demand on both this morning.

EURUSD: Softer risk tones/firmer USD/French election fallout/ECB rate hike conjecture still playing out on this pair and now has seen 5-year lows of 1.0589 this morning.I remain a rally-selller as my preferred side. USDJPY: Good two-way pips again whatever your bias after a drop to 126.94 and rally to test 128.00 so far. I've banked a few pips again as it should continue to see some two-way action amid the uncertainty. EURJPY: Support at 135.00 holding so far after capping around 136.50 .Looking soggy over all still. USDCHF: A further rally amid firmer USD tones and EURUSD retreat and now testing 0.9660 after a good hold of 0.9600-20. SNB definitely getting a helping hand but EURCHF sellers remain poised. EURCHF: A further retreat into 1.0215 amid the EURUSD selling and softer risk tones but with the SNB lurking in the dips.

AUDUSD: Rally failure at 0.7230 but holding 0.7115 in the retreat then bounce to test 0.7200 after the CPI data.GBPAUD capping into 1.7650 this time as GBPUSD retreat outstrips that of AUDUSD. NZDUSD holding 0.6550 in latest retreat but equally capping at 0.6600. GBPNZD currently near its latest lows of 1.9085 but buyers lurking 1.9030-50 after capping at 1.9200.

USDCAD: Commodity currency/USD demand double whammy impact still and a further rally to 1.2840 as I type breaking out of recent ranges. Two-way business still expected amid all the uncertainty.

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

Interbank rates: 08.37 BST

GBPUSD 1.2553

EURUSD 1.0617

EURGBP 0.8450

GBPEUR 1.1835

GBPJPY 160.75

GBPCAD 1.6102

GBPCHF 1.2136

GBPZAR 19.9257

GBPHKD 9.7788

USDJPY 127.95

EURJPY 135.88

EURCHF 1.0244

EURHKD 8.2594

AUDUSD 0.7160

USDCAD 1.2823

USDCHF 0.9645

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