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  • Writer's pictureMike Paterson

US Dollar in retreat but jury remains out

Tuesday 3 December 2019

Yesterday saw some further risk-off sentiment which saw USDCHF and USDJPY suffer some decent losses (all relative ofc given current ultra-tight ranges) and we're still seeing some downward pressure this morning as European trading gets underway. Equities are trying to recover after yesterday's losses but the jury remains well and truly out.

GBPUSD has now broken up through the 1.2950 offers/resistance helped this morning by the latest General Election poll so the good two-way business continues with sell interest at 1.3000 lurking again.EURGBP broke back above 0.8550 helped by some unusually large demand in EURUSD but lower again now at 0.8530 as GBPUSD plays catch up amid the USD supply. GBPJPY remains tightly bound but underpinned above 141.00 still.

I will continue to rally-sell GBP as my preferred strategy overall too amid the ongoing Brexit/Election uncertainty but happy to buy back in the dips as ever. In essence the general uncertainty and can kicking continues and for me that's still Pound negative overall but I respect that some others (and the algos) see it differently). Remember we're ranging still so don't get too greedy whatever your bias.

EURUSD had a good day after chewing its way through the the 1.1030 option expiry interest and holding gains helped by the general USD supply and the earlier PMI data. USDJPY had a decent fall to test 108.80-00 after those USD1.5bln in expiries rolled off at 109.50-52 and we're still down there now. USDCHF led the Greenback lower yesterday to test 0.9900 amid the EURUSD charge higher and that ongoing EURCHF supply above 1.1000 that I've been highlighting.

AUDUSD has found itself on a charge higher to post 0.6860 helped by the USD selling and then RBA leaving rates on hold as expected but Governor Lowe disappointing the bears by once again pouring cold water on any immediate rate cuts/QE.USDCAD continues to trade tightly with the general USD supply tempered by softer oil prices and decent demand in the dips.

Fickle Forex markets ever prevailing so be ready with your entry/exit levels and orders as always.

Tonight the Shrimpers of Southend journey north to face Burton Albion and we'll hope that whatever work is being done behind the scenes by our new manager will bear some fruit.

Have a good day out there one and all.

Interbank rates: 08.14 GMT

GBPUSD   1.2975

EURUSD   1.1080

EURGBP   0.8540

GBPEUR   1.1711

GBPAUD   1.8951

GBPCAD   1.7252

GBPJPY   141.60

GBPZAR   19.0232

GBPHKD   10.0595

USDJPY   109.09

USDZAR   14.6516

EURJPY   120.91

EURCHF   1.0975

EURHKD   8.5898

AUDUSD   0.6847

USDCAD   1.3292

USDCHF   0.9903

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