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  • Writer's pictureMike Paterson

Pound firmer after MPC amid some risk-off sentiment

Thursday 6 August 2020

This morning the BOE MPC duly left rates and QE on hold as expected and I reported earlier and in the absence of any dovish news bombs we've seen the Pound make a few gains across th board. No one getting too carried though with the embargoed press conference still to happen with general release at 09.00 GMT.

Elsewhere we've seen some general USD supply again but jury still out as equities and commodities retreat a little this morning after further rallies so we're seeing some risk-off plays develop as I type.

GBPUSD has been up to look at the 1.3180-85 resistance and re-sells duly placed as per my tweet but supported since into 1.3150 with help from EURGBP falling through 0.9030 after failing at 0.9054.EURGBP has more support at 0.9000. GBPJPY is currently testing 139.00 again as I type but having found support at 138.75 post-MPC amid the generally firmer Pound.

I stay poised to sell GBP rallies overall as my preferred side and buy back in the dips as ever.Patience will continue to be a virtue and entry level key as always. I still expect to continue seeing dip demand though post-MPC and amid the generally softer USD tones atm.

USDJPY found a base this time into the next support/demand at 105.30 but equally capped at 105.65 as normal services resumes. EURJPY found support at 124.80 again but capped above 125.50 this time around but now finding support at 125.15-20 again. EURUSD had a brief look at 1.1920 earlier this morning on seemingly some programmed USD selling across the board but ran out of oxygen and now down looking at 1.1850. USDCHF found itself in solid retreat on the softer USD tones again to test 0.9050, lows not seen since May 2015 as EURUSD rallied and with EURCHF still ranging with the SNB seemingly watching, but I wouldn't rule out them putting the 0.9050 support line in.

AUDUSD failed into 0.7250 and some re-sells duly placed with Victoria COVID lockdown still in focus but support into 0.7180 for the moment.USDCAD fell to 1.3230 amid softer USD/firmer oil but since rallied to 1.3290 only to fall below 1.3250 before rallyiong again to 1.3280 (Keep up at the back1) amid variable risk/USD/oil.

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

Interbank rates:  07.55 BST

GBPUSD   1.3158

EURUSD   1.1878

EURGBP   0.9025

GBPEUR   1.1076

GBPAUD   1.8293

GBPCAD   1.7463

GBPJPY   138.88

GBPZAR   22.9812

GBPHKD   10.2014

USDJPY   105.47

USDZAR   17.4818

EURJPY   125.29

EURCHF   1.0782

EURHKD   9.2104

AUDUSD   0.7195

USDCAD   1.3263

USDCHF   0.9078

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