Perky Pound prevailing again
Thursday 18 February 2021
Yesterday I highlighted in my opening summary here that the Pound remains bouyant on vaccine-fuelled hopes of a quicker UK recovery while the Euro continues to lag behind and so it's played out with EURGBP falling to lows not seen since April 2020 and GBPUSD shrugging off yesterday's fall to 1.3830 to post 1.3910 as I type. The move was helped in a hurry this morning as a regular 08.00 GMT algo intervention saw some rapid GBP buying and holding gains amid some general USD supply.
The Forex jury is ever-fickle amid all the noise and sentiment can turn quickly as I keep repeating and we've seen in the past 24 hours so keep playing the price action in front of you, pick your entry/exit levels carefully and don't over analyze or assume anything.Oh, and don't get greedy...!
GBPUSD yesterday broke down through 1.3860 amid the general USD demand but held 1.3830, underpinned by EURGBP continuing to look soft and now up to 1.3915 as I type.EURGBP tried clinging to 0.8700 where we had that sizeable options interest, and yet again today, lending some support but the pressure remains to the downside. Those bids at 0.8680-85 held the falls but now posted lows of 0.8671 in that algo-led GBP grab earlier this morning.GBPJPY found a decent base into 146.40 after breaking back down through the 146.80 support but back up to 147.00 now amid core pairs both finding dip demand.
I still have a naturally bearish stance on GBP overall and remain poised to sell into rallies but respecting dip demand still with price action ever fickle. Equally a case still for going long in the dips therefore as we continue to range. Patience and not getting greedy remain key.
USDJPY has broken back down through the 105.80 suppport area amid the general USD supply this morning but holding 105.70 for the moment. EURJPY fell back through 128.00 as core pairs both found rally sellers but now some dip demand at 127.35-40. EURUSD yesterday continued its retreat to test 1.2025 amid the firmer USD/wobbly EUR on the crosses double-whammy but some dip demand notable again helped by options interest nd now back up to 1.2070. USDCHF found a good base at 0.8950 this time and has been up to test 0.9000 as EURUSD retreated with EURCHF also underpinned with the SNB ever watchful and seemingly giving a helping hand again.
AUDUSD duly found support at the key 0.7725-30 area again and now testi9ng 0.7780 once more while USDCAD has found a good cap this time at 1.2750 after the USD demand-led rally from 1.2680 and holding down there again on the retreat.
Let's continue to be careful out there in all things. Staying safe must be our main priority still. Have a good week out there.
Interbank rates: 08.16 GMT