Pound underpinned and ECB in focus
Thursday 24 January 2019
Brexit continues to hog the headlines and support the Pound but it's by no means the only game in town right now. Today sees the latest interest rate/policy decision/rhetoric from the ECB and across the pond there's still an awful lot going on around the White House/S government shutdown to keep markets on their toes and risk sentiment a little fragile still.
GBPUSD has been up to test offers/resistance between 1.3090-3100 after forming a base around 1.2980-1.3000 albeit with a few rallies and dips in the journey higher helped by EURGBP breaking even lower through decent lines at 0.8750 and 0.8730 to post lows of 0.8696 (GBPEUR up to 1.1499) exacerbated by some EURUSD supply too again. The usual month-end EURGBP demand should at least help stem further falls for the moment and that will start to kick in any time now until 31 Jan.
GBP bias remains to the upside for the moment but I remain bearish overall and happy to jump on rallies then job back in the dips as I still see the greater risk to the downside until proven different but definitely respecting the current GBP demand. I'll repeat what I said yesterday here, and in tweets, that bulls should not get too carried away by a 200+ pips rally in the bigger scheme of things but yes of course it's a decent move in the current tight ranges.
EURUSD fell to test 1.1330 again but remains tightly bound as we wait on the ECB decision at 12.45 GMT and the all-important presser at 13.30 GMT. i'm not expecting any great change from Draghi&Co today (as in I've always been more dovish than hawkish on ECB rate hikes/tightening) but as always we must stand poised.USDJPY remains tightly bound in a 109.30-80 range for the moment.
USDCHF remains underpinned with the SNB ever-watchful but equally still finding rally sellers too also helped by some safe-haven CHF demand overall. AUDUSD continues to look fragile still as I've been highlighting, now breaking down below 0.7100 while USDCAD has moved up to 1.3369 with oil prices retreating again and some CADJPY supply also playing out.
Fickle Forex markets ever prevailing so be ready with your entry/exit levels and orders as always.
I wish you a good day ahead.
Interbank Rate 08.20GMT GBPUSD 1.3038 EURUSD 1.1356 EURGBP 0.8705 GBPEUR 1.1485 GBPAUD 1.8380 GBPCAD 1.7418 GBPHKD 10.1176 USDJPY 109.64 EURJPY 124.50 GBPJPY 142.98 AUDUSD 0.7097 EURCHF 1.1311 USDCAD 1.3360 USDCHF 0.9960 EURHKD 8.8087