Ukraine uncertainty continues
Thursday 17 February 2022
Reports of shelling and gunfire in Eastern Ukraine this morning adding to the uncertain tones and risk-off plays prevailing but by no means one-way traffic. Equity markets are softer while oil is off its lows and remain underpinned overall still as I warned yesterday. Gold higher again amid the uncertainty and now posting 1890 after a good hold around 1845 yesterday that I highlighted here.
I repeat that it's not for us to determine what the outcome over Ukraine will be but the guessing game will continue and keep the headline-algos jumping on hot coals. 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 good hold of 1.3550 in latest retreat and some pips banked but sellers still poised. Mixed risk tones helping to contain along with large option interest today and tomorrow.EURGBP: Duly finding support around 0.8350 still but finding another rally above 0.8380 a step too far with large option interest at 0.8390 and mixed risk helping to contain as the uncertainty remains. GBPJPY: Finding support at 156.00 in the latest retreat after a risk-off failure at 157.00. Caution still required atm amid risk-off/on uncertainty.
EURUSD: A good hold of 1.1320 then 1.1340 this time after failure around 1.1380.Large option interest tomorrow in play too. USDJPY: Support around 115.50 now history amid risk-off JPY supply and some softer USD tones after failing at 115.60. Now testing 115.00. EURJPY: Capped at 131.50 this time around and now testing 130.40-50 support as JPY supply once again outstrips any EUR selling. USDCHF: 0.9200 support expected after the fall through 0.9220-30 amid EURCHF falling back to 1.0450. SNB ever vigilant but rally sellers poised too still. EURCHF: Testing 1.0450 support after breaking down through, and then capping, at 1.0500 amid some strong CHF demand.
AUDUSD: Some risk-off AUDJPY and AUDCHF supply now helping to cap at 0.7220 as the rollercoaster risk ride continues.Support so far at 0.7180 helped by softer USD tones. USDCAD: Capping at 1.2760 and now 1.2740 on the firmer/underpinned oil price and softer USD tones but some CADJPY supply. Option interest tomorrow casts a shadow too.
Let's continue to be careful out there in all things. Staying safe must be our main priority still.
Interbank rates: 08.34 GMT