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  • Writer's pictureMike Paterson

Rollercoaster ride continues as Greenback gets dumped.

Friday 20 March 2020

Crazy and worrying times continue and so does the volatility as, after another day of US Dollar gains overall albeit with lessening demand, we've seen Asian markets in reverse, and some. Lots of new liquidity/USD swap measures being introduced by CBs in the pst 24 hours including a 0.15% rate cut and £200bln QE boost from the BOE.

The current impact is that oil has continued it's sharp correction higher, equities are rallying too and there seems to be a better risk sentiment that's seen USDJPY losses contained and also underpinned USDCHF losses. The reverse of what we've mostly been seeing over the past few days. Hold onto your hats folks if you're trading these markets which are now "bigger picture " as the ranges are more extensive.  In these times traders need to stand back and take a more considered approach. Being patient/disciplined should bring good reward. Being stubborn rarely ends so well.

As I've said a few times this week please feel free to contact me on any of the current issues and impact on FX markets in these very difficult times. I would also like to hear from you to let me know whether you are still trading through all this turmoil or reducing your activity. How may I help further/guide you in these difficult times?

GBPUSD found itself rallying hard on some better risk sentiment and those new measures by the BOE but came to a grinding halt into 1.1800 and fell sharply to 1.1400 before reversing in Asia to post 1.1879. EURGBP has been on a roller coaster ride of its own between 0.9450-0.9080 (GBPEUR 1.0580-1.1010) amid the BOE measures et al and now bouncing again helping to send GBPUSD lower to 1.1740 as I type.GBPJPY found a base at 125.00 before bouncing to 129.50 as USDJPY rallied to 111.37 before falling on the USDJPY reversal only to then rally again to 130.40 as I type on the better risk and core pair dip demand.

I stay poised to sell GBP rallies and buy back in the dips as ever.Always difficult to judge the level of retracement after such big moves but I still see continued weakness.

USDJPY has rallied to 111.37 ,initially with USD demand tempered by the JPY buying, until risk-sentiment turned more positive from when the reverse has been true as I mentioned above. EURJPY has been down to 117.40 before bouncing only to fail into 118.80 but contained since by the better risk sentiment as core pairs both find dip demand.EURUSD dropped to test 1.0650 amid the initial USD demand and rolling out the additional ECB measures but recovered well on the general USD supply to post 1.0830 before retreating.USDCHF has ranged 0.9700-0.9900 with EURCHF finally falling below that SNB line in the sand at 1.0540 to post 1.0521 before returning to 1.0540 as I type.

AUDUSD has rallied sharply to 0.5985 while USDCAD has fallen to 1.4150 on the fimer oil/USD supply/risk-on triple whammy ( what a difference a day makes eh?).

Fickle Forex markets ever prevailing so be ready to jump on moves with your entry/exit levels and 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 and make sure you get some rest over the week-end.

Interbank rates: 07.58 GMT

GBPUSD   1.1812

EURUSD   1.0788

EURGBP   0.9132

GBPEUR   1.0947

GBPAUD   1.9875

GBPCAD   1.6860

GBPJPY   130.20

GBPZAR   20.3248

GBPHKD   9.1578

USDJPY   109.78

USDZAR   17.3005

EURJPY   118.48

EURCHF   1.0541

EURHKD   8.3656

AUDUSD   0.5700

USDCAD   1.4223

USDCHF   0.9777

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