Perky Pound but range bound still
Thursday 21 November 2019
The last 24 hours has seen some general demand on a combination of profit-taking,calmer risk sentiment providing some GBPJPY and GBPCHF demand and no additional shocks (for the moment) in the various Brexit/Election rhetoric. A busy option expiry board today also in play while elsewhere it's still a case of focus on US-China trade deal sentiment and that remains fragile.
GBPUSD held support at 1.2885-90 yesterday helped by the 1.2890-00 expiry interest I also highlighted but equally we have not been able to get back above 1.2950. Some risk-on GBPJPY demand but contained for the moment by some large expiry interest today at 1.2945-55, 1.2960-65 then 1.2990-3000 again. EURGBP has held 0.8550 but similarly unable to get back above 0.8580 for the moment with EURUSD also rallying. GBPJPY also continues to see good two-way trading between 139.50-140.50 amid the variable risk plays but underpinned again for the moment.
I will continue to rally-sell GBP as my preferred strategy overall too amid the ongoing Brexit/Election uncertainty but happy to buy back in the dips as ever. In essence the general uncertainty and can kicking continues and for me that's still Pound negative. Remember we're ranging still so don't get too greedy whatever your bias.
EURUSD remains tightly bound amid ongoing large option expiry interest which today sees in excess of EUR 2bln between 1.1025-50 and over EUR 2.5bln between 1.1090-1.1110. USDJPY retreated back below 108.30 but still unable to break convincingly given that we have also expiries down there today and now helped by some better risk sentiment. USDCHF has tested support around 0.9900 again as EURUSD rallies but still underpinned given the SNB being ever vigilant.
AUDUSD remains on the back foot with AUDJPY supply still helping to cap and now tested 0.6785 bids but some profit taking on both pairs helping to support for the moment along with A$1bln in expiries between 0.6800-10 today. USDCAD has found itself underpinned still and climbing to post 1.3322 with oil prices higher too but capped by a little CADJPY demand at the moment.
Fickle Forex markets ever prevailing so be ready with your entry/exit levels and orders as always.
Have a good day out there one and all.
Interbank rates: 08.25 GMT