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  • Writer's pictureMike Paterson

US Dollar in a whirl as markets wait on key jobs data

Friday 4 October 2019

A roller coaster ride for the Greenback yesterday after some more soggy US economic data. Lowest ISM non-manufacturing in 3 years caused equities and the US Dollar to tumble but in these days of tight ranges it wasn't long before algos and traders were taking profit and reversing the moves.

Today sees another key US data release in the shape of NFPs at 08.30 GMT then Fed Chair Powell speaking at 18.00 GMT so we can expect more volatility but will depend on how much any soggy numbers and FOMC rate cut expectations are getting factored in. Elsewhere the Brexit/Johnson shambles continues with the EU giving him a week to come back with something more workable and the Pound remains undermined overall despite talk that some Labour MPs will vote in favour. I would expect them to be reined in by Corbyn but all in the mix still.

GBPUSD is still providing good two-way opportunity therefore regardless of your bias but once again I was happy to keep re-selling rallies as we rallied to 1.2410 but now respecting some demand building at the pivotal 1.2320-30 area. EURGBP has remained underpinned with Euro rallies initially outstripping those of the Pound and we've seen a hold of 0.8850 (1.1300) but yet to break back above 0.8900 (1.1235). GBPJPY has also seen good two-way business with a failure into 132.50 resulting in another retreat and test of 131.50.

I will continue to rally-sell GBP as my preferred strategy overall too amid the ongoing uncertainty/indecision including Brexit/political fallout but happy to buy back in the dips as always.Rinse and repeat.Still no reason to change my view any time soon as the current madness plays out but caution as ever is appropriate. Just ignore the noise, identify the trading ranges, and let the algos do the work.

EURUSD breached 1.0965 but failed to break 1.1000 which once again proved to be a decent line in the sand. USDJPY duly fell through 107.00 then 106.80 to trade all the way down to 106.40 but unable to breach 107.00 on the correction. USDCHF also fell on the softer USD/risk sentiment combo to test 0.9950 but tempered with EURCHF again finding dip buyers.

AUDUSD enjoyed the softer USD/firmer Gold combo and rallied to 0.6760 before also retreating but holding 0.6730 so far.USDCAD held 1.3300 on the retreat but failing to breach 1.3350 still.

Fickle Forex markets ever prevailing so be ready with your entry/exit levels and orders as always.I am now stepping out for the day. I was due to be away on hols at this time but plans have changed so I am now able to bring you these updates yesterday and today at least if not any intra-day Twitter steers. I hope it's helped guide you in these uncertain times.

Don't forget I offer 1-2-1 mentoring if there's areas of trading this latest volatility, or how to make best use of the order boards and expiries that you might need some further help with.

Huge congrats to KJ-T on her heptathlon gold after banishing a few demons. Let's hope the soggy Shrimpers can banish a few tomorrow as they, and I, make the short journey to Gillingham. Some more intrepid fans though will be walking from Southend in aid of local charities and which I'm delighted to be sponsoring. I joined them last time on a 37mile walk to Charlton so I know how much it's going to hurt. Please follow this link and give what you can. Thank-you.

Have a good day/weekend out there one and all.

Interbank Rate 07.50 BST

GBPUSD   1.2347

EURGBP   0.8882

EURUSD   1.0981

GBPEUR   1.1257

GBPAUD   1.8282

GBPCAD   1.6464

GBPJPY   131.86

USDJPY   106.79

EURJPY   117.11

EURCHF   1.0960

AUDUSD   0.6752

USDCAD   1.3335

USDCHF   0.9994

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