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  • Mike Paterson

Risk-off sentiment returns

Monday 14 February 2022

Equities and oil markets in retreat this morning with JPY and CHF demand in FX pairs as tensions over the perceived Russian invasion of Ukraine gathers pace following-on from comments made late on Friday and over the week-end.

Gold has rallied to $1863 as befits its safe-haven status due to all the various uncertainties. Meanwhile conjecture over Central Bank rate hikes continues to add more uncertainty into the mix.

As ever, a case of not over-analysing or second-guessing but keeping your focus on price action in core and cross-pairs and identify ranges and what levels present value for money. Patience invariably a virtue but don't confuse patience with being stubborn either in entry or exit.

GBPUSD: A test of 1.3500 this morning amid the risk-off GBPJPY selling and EURGBP demand after capping into 1.3600. EURGBP: Eventually found support at 0.8350 (GBPEUR resistance 1.1975) but sellers poised 0.8385-00. Should continue to see two-way business as the uncertainty remains. GBPJPY: Testing 155.30-50 after failing at 156.80 with risk tones turning sour and the return of JPY demand which suits my ongoing strategy.

I remain a GBP rally seller across the pairs overall as my preferred trading side but being patient as ever.

EURUSD: Firmer USD tones generally helping to push down the pair to test 1.1300. USDJPYU testing 115.00 after retreating from the pivotal 115.50-60 area. EURJPY: A solid retreat from 131.00 as JPY demand oustrips any EUR risk-off buying. USDCHF: 0.9220 support line still holding but rallies tempered by CHF risk-off demand. SNB ever vigilant and some general USD demand helping support still but rally sellers poised too. EURCHF: Holding 1.0450 as I type amid the risk-off CHF demand but with SNB shadow cast still after rally aellers capped at 1.0500-10.

AUDUSD: General USD demand and now the risk-off AUDJPY and AUDCHF supply helping to cap still as we dip below 0.7100 again after the 0.7160-80 failure.USDCAD: Decent rally on the general USD demand and softer-risk CADJPY selling. Sellers poised 1.2785-00 but support building 1.2725-50.Huge option interest at 1.2650-60 last Friday definitely helped to support.

Another great win for the mighty Shrimpers on Saturday stretching the unbeaten run to 9 and pushing us up to the heady heights of 12th...It's all relative but good times are back....

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

Interbank rates: 08.42 GMT

GBPUSD 1.3506

EURUSD 1.1314

EURGBP 0.8375

GBPEUR 1.1936

GBPJPY 155.50

GBPCAD 1.7253

GBPCHF 1.2491

GBPZAR 20.6122

GBPHKD 10.5165

USDJPY 115.16

EURJPY 130.24

EURCHF 1.0468

EURHKD 8.8107

AUDUSD 0.7092

USDCAD 1.2726

USDCHF 0.9256

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