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  • Mike Paterson

Pound under pressure still and risk-off returns

Thursday 23 May 2019

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e've not exactly seen any great surprises and with May under pressure and another leading government resignation my GBP rally-sell strategy continues to work well.I've warned for a long time that the political fallout will cause problems for the UK and GBP regardless of Brexit outcome and I stand by that still. Elsewhere it's risk-off again with equities and commodities on the back foot and my banging on about fragile conditions continues to have substance.


GBPUSD has now posted fresh lows of 1.2605 as the reality check continues with EURGBP still underpinned and GBPJPY/GBPCHF selling adding to the supply.EURGBP buyers still holding sway and we've rallied to new recent highs but running into sellers ahead of 0.8850 sell interest (GBPEUR buyers 1.1300) as EURUSD also retreats down to test 1.1130 with EURJPY and EURCHF selling back making an impact. GBPJPY also on the retreat again helped by USDJPY selling and the Yen demand.


I remain GBP bearish overall and continue to rally-sell as my preferred strategy and buy back in the dips amid all the uncertainty/indecision including Brexit. No change to this view for the foreseeable future. Dip buyers will still expect to find better value for money the lower we head but that's still not happening at the moment.


EURUSD failed again at the 1.1180 sell interest and option expiries I warned you about and we've now been down to test 1.1130 as we head into the EU parliamentary elections today and protest votes expected all over the EU not least of which the UK which bizarrely still finds itself having to take part.


USDJPY has retreated again amid the risk-off sentiment. Definitely still a case of rinse and repeat but still not going too far in a hurry. USDCHF remains tightly bound amid the risk uncertainty with the SNB watching closely still as EURCHF falls to test 1.1230 support.


AUDUSD has been holding its own amid the variables and the 0.6850 option interest ( more there tomorrow) still in play while USDCAD has bounced yet again in its current range-trading mode with some CADJPY selling notable and oil price falling again to undermine the Loonie once more.


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 Rate 09.27 BST

GBPUSD   1.2615

EURUSD   1.1138

EURGBP   0.8828

GBPEUR   1.1327

GBPAUD   1.8360

GBPCAD   1.6982

USDJPY   110.91

USDZAR   14.4690

EURJPY   122.67

GBPJPY   138.97

GBPZAR   18.2800

GBPHKD   9.7804

AUDUSD   0.6873

EURCHF   1.1240

EURHKD   8.6346

USDCAD   1.3461

USDCHF   1.0089

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