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  • Mike Paterson

US Dollar demand prevailing overall still

Thursday 3 September 2020

More of the same in the past 24 hours as we've seen further correction to the USD selling notable in recent times but it's far from clear as to the extent this will develop into.

Elsewhere the ECB's concern over Euro stength is gaining column inches ahead of next week's  policy meeting/announcement/presser. All this amid ongoing European COVID resurgence concerns and the US election campaign sees some more toys thrown of the pram as expected.

Some disappointing final PMI data this morning, notably UK Services, but in the bigger picture none of it that dramatic given the ever shifting sands.

GBPUSD has continued its retreat to test the 1.3275-80 area this morning courtesy of the regular 07.00 GMT algo but since trying to clamber back above 1.3300.EURGBP found itself trading tightly between 0.8880-0.8910 but has now posted new 3-month lows of 0.8866 as another day gets underway amid the general EUR-neg vibe but heading back to 0.8900 s I type. GBPJPY continued its retreat to test 141.00 before bouncing in some good two-way business but since failing at 141.85 on the general GBP/risk retreat.

I stay poised to sell GBP rallies overall as my preferred side and buy back in the dips as ever.  Patience continues to be a virtue and entry level key as always. I still expect to continue seeing dip demand though should we retreat further.

USDJPY continues to range 105.50-106.50 on the wide (106.00-106.35 the close touch now) amid the generally variable risk and firmer USD combo. EURJPY has capped at 126.20 and now tested 125.30 amid the general EUR retreat/softer risk. EURUSD dplayed out its retreat amid those large expiries and has tested 1.1780 before a decent rebound this morning with large option expiries between 1.1815-30 today in play. USDCHF has found a new base at 0.9100 (probably SNB still) but equally failing into 0.9150 as EURCHF retreats.

AUDUSD has broken down through 0.7330 but holding 0.7300 for the moment as the jury remains out on the extent of this USD demand. USDCAD found that base at 1.3000 again but still struggling to break 1.3100 as oil price remains firm/USD undecided.

Markets are ever-fickle but good two-way pips to be had so don't forget to take advantage of my 1-2-1 mentoring sessions if there's areas of trading these markets or how to make best use of the order boards and expiries, that you might need some further help with.

I wish you good trading and let's continue to be careful out there in all things. Staying safe must be our main priority still.

Interbank rates:  08.50 BST

GBPUSD   1.3302

EURUSD   1.1815

EURGBP   0.8883

GBPEUR   1.1256

GBPAUD   1.8200

GBPCAD   1.7398

GBPJPY   141.32

GBPZAR   22.2811

GBPHKD   10.3130

USDJPY   106.25

USDZAR   16.7392

EURJPY   125.57

EURCHF   1.0778

EURHKD   9.1623

AUDUSD   0.7312

USDCAD   1.3077

USDCHF   0.9119

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