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  • Writer's pictureMike Paterson

Pound in a whirl as uncertainty continues

Thursday 26 March 2020

It's been a rollercoaster ride, and some, for the Pound in the last 24 hours and looking bid again this morning as another crazy day kicks in. The early risk-on rally soon turned into a rout and we saw GBP pairs in rapid reversal amid some risk-off, doubts on our capacity to cope with COVID but no solid explanation. Go with the flow, "ours is not to reaon why" et al were the name of this game as Pound pairs reversed sharply in to the 16.00 GMT fix and just kept on going.

That underlying demand was notable in the price action with GBPUSD ramping up with bids coming in above offers once we came back above 1.1670 from the 1.1638 lows and that was a sure sign someone was hoovering and shorts were suitably running for cover, including me. Stand well back was the message and I hope the sellers amongst you were not caught too badly. The move down in the Pound exceeded my expectations so found myself taking profit on shorts too early but at least I didn't get caught on the rapid rebound. Don't get greedy is another of my mantras as you know.

Elsewhere we saw equity markets in early decline only to also rebound while the US anti-COVID stimulus package has once again failed to get addressed while others around the world continue to pump liquidity, both monetary and and fiscal, into their systems.

GBPUSD has found a good line in the sand at 1.1820 now since yesterday's sharp rally above 1.1900 and we've seen another strong rebound rallying to 1.1963 so far this morning and EURGBP down to 0.9134 from 0.9242 as EURUSD rallies less again. EURGBP yesterday found a base at 0.9060 (GBPEUR sellers at 1.1035) and rallied to 0.9265 (1.0795) so there's your range for now. GBPJPY fell to test 130.00 and since rallied to test 132.50 but in retreat again as USDJPY falls outstripping even the GBPUSD rally atm.

I stay poised to sell GBP rallies and buy back in the dips as ever.Nothing in these latest moves to change my mind but as always patience is a virtue and entry level key.

USDJPY has found a cap above 111.50 YET again and finally picked up some downside momentum to post 109.81. EURJPY has enjoyed a solid rally from 120.00 as EURUSD found buyers too before failing above 121.00 and retreating as USDJPY supply returns.EURUSD has been up to 1.0946 amid the general USD supply but sellers remain poised into 1.1000.USDCHF capped around 0.9820 again but losses below 0.9750 tempered buy some EURCHF demand again with that pair posting new recent highs of 1.0655. That propping up between 1.0520-40 noew seems a distant memory eh?

AUDUSD tumbled to look at 0.5880 from 0.6065 but finding some buyers this morning on the general USD supply to post 0.5978. USDCAD has fallen from 1.4415 to 1.4170 amid the general USD supply and large anti-COVID stimulus package announced yesterday.

Fickle Forex markets ever prevailing so be ready to jump on moves with your orders as always. Caution advised as ever if you're not sure.

Lots going on right now, and the foreseeable future, so don't forget that I offer 1-2-1 mentoring if there's areas of trading these volatile markets or how to make best use of the order boards and expiries, that you might need some further help with.

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

Interbank rates: 08.36 GMT

GBPUSD   1.1918

EURUSD   1.0938

EURGBP   0.9176

GBPEUR   1.0894

GBPAUD   2.0020

GBPCAD   1.6947

GBPJPY   131.33

GBPZAR   20.8751

GBPHKD   9.2400

USDJPY   110.17

USDZAR   17.5564

EURJPY   120.57

EURCHF   1.0645

EURHKD   8.4817

AUDUSD   0.5954

USDCAD   1.4216

USDCHF   0.9727

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