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  • Mike Paterson

Up and down for the Greenback again

Tuesday 6th December 2022

Yes folks, another day of decent US data saw the Greenback head higher again but there's still no real one-way momentum and so the two-way trading continues as the the CB second-guessing continues. USDJPY has once again led the way up and down.

Equities have had another wobble in the wake of yesterday's strong US releases and oil has fallen once again as has gold after being unable to capitalise on its $1810 highs. China plan to announce more COVID relaxtion measures tomorrow and geopolitical risk in Ukraine still lurking too. Earlier on we had the RBA hiking by 25bps as widely expected given their recent rhetoric. Tomorrow brings the BOC ahead of next week's long list of CBs.

Remember, Focus on the price action and let the algos do the heavy lifting/dropping. The important thing is to identify your preferred risk/reward entry/exit levels.

GBPUSD: Still holding 1.2150 after yesterday's retreat from 1.2260 post-US data and a move back up through 1.2200 since but failing to hold gains and I remain poised to re=sell. EURGBP: Finding good support at 0.8580-85 again still and now pushing up through 0.8600 again after yesterday's failure at 0.8640. I expect the two-way business to continue as jury remains out on both currencies and outlook.GBPJPY: A good cap at 167.50 in yesterday's USDJPY-led rally but equally heading back lower as core pairs cap and risk wobbles again.

EURUSD: A decent hold at 1.0475 this time after the US data dip but capping into 1.0525.Should still see some mixed business and I remain a rally seller overall as my preferred side. USDJPY: Yesterday I warned of some caution needed for rally-sells and so it proved as we continue to see some claw back of last week's retreat but equally patience remains a virture too. A good cap into 137.50 but 136.50 providing support as the jury remains out. EURJPY: Capping at 144.00 again this time after holding 143.00 as we continue to range. USDCHF: A decent rally fromm 0.9350 but struggling again to take full advantage of the returning USD demand and capping at 0.9430-50 with traders still looking at SNB tightening/hawkish tones next week. EURCHF ranging tightly for the moment. SNB ever-vigilant.EURCHF: A hold above 0.9880 now but equally finding it difficult to rally

AUDUSD: Finally a solid retreat and justifying my bearish thoughts with 0.6850 then 0.6820 providing a good cap as the USD demand triggered a decent fall. Good support around the old 0.6680 line again but equally another old line at 0.6740 now providing good supply/res. RBA sprung no surprises. GBPAUD trading 1.8100-1.8200 now in the latest tight range. NZDUSD now cappaed at the old support line of 0.6350 but holding 0.6300 as the jury remains out. GBPNZD capping into 1.9350 but tempered some GBP dip demand/NZDUSD supply and holding 1.9200. USDCAD: A good hold of 1.3400 this time and strong rally to 1.3610 amid the firmer USD/tumbling oil double whammy. Expect some two-way business still overall as markets remain ever-fickle. BOC tomorrow with hike expectations at 50 bps.

Let's continue to be careful out there.

Interbank rates: 08.53 GMT

GBPUSD 1.2180

EURUSD 1.0495

EURGBP 0.8615

GBPEUR 1.1605

GBPJPY 166.42

GBPCAD 1.6565

GBPCHF 1.1488

GBPZAR 21.1012

GBPHKD 9.4882

USDJPY 136.60

EURJPY 143.38

EURCHF 0.9897

EURHKD 8.1795

AUDUSD 0.6720

NZDUSD 0.6320

USDCAD 1.3611

USDCHF 0.9434

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