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  • Writer's pictureMike Paterson

US Dollar still on the back foot

Wednesday 21 August 2018

The Greenback took another hit yesterday as Trump's former lawyer, Michael Cohen,pleaded guilty to eight counts of tax and bank fraud in a plea deal with prosecutors. With ex-campaign chief Paul Manafort also being found guilty on eight charges of tax fraud Trump remains under intense focus.

GBPUSD has needed little excuse to make further gains with the Pound currently enjoying some relief after the recent extensive falls and the pair has blown through 1.2850 and 1.2900 before capping into the next decent line to 1.2920. We've since been back down to test 1.2870 support with some general USD demand returning after the latest knee-jerk selling spree.Immediate support/buying interest now around 1.2870 then larger around 1.2850, 1.2830 and 1.2800.Sellers at 1.2900 and still poised at 1.2920 with more interest between 1.2950-60. Rallies can still be sold for short term plays but equally the dip demand on the softer USD tones is notable. The latest FOMC Minutes will be published this evening and then, more importantly, we have Powell's keynote speech at Jackson Hole on Friday to keep in mind.

EURGBP failed twice into 0.9000 and has retreated to test support around 0.8950 as the Pound felt some love. Sellers still poised around 0.9000 then 0.9030. Buying interest building between 0.8950-60 again then larger at 0.8930 and 0.8900 still.

EURUSD rallied further to test 1.1600 before running out of puff once again and falling back to 1.1550 support lines. Sellers still around 1.1600, then 1.1620 and 1.1650.Buyers still around 1.1550 then more into 1.1530 and 1.1500.

USDJPY looked underpinned for much of the session after holding those strong support lines at 109.80 but failed to break up through 110.50-55 resistance and duly fell back to test 110.00 on the Trump-implicated news from across the pond.Sellers still poised with large option expiry interest expected to contain the range then 110.80-00 still. USDCHF has drifted lower again with the SNB stepping to one side but not going to be too far away albeit comforted by EURCHF remaining underpinned above 1.1350.Sellers remain poised on both though as I've been warning but we can continue to expect dip demand still.

AUDUSD has failed into 0.7380 and retreated back below with the Aussie government facing its own wobbles currently. Immediate buying interest at 0.7320,0.7300 and 0.7280. Sell interest still 0.7375-80 and 0.7400. USDCAD remains on the back foot but managing to hold onto 1.3000 support so far.More buyers lined up at 1.2980 behind that. Sellers now at 1.3030 then into 1.3050 and between 1.3080-00.

Fickle Summer markets still prevailing so get your orders in to take full advantage of these moves.

A wasted journey for the mighty Shrimpers,and yours truly, last night as a dismal display meant leaving Luton empty handed. Oh well, some lessons learned hopefully. Onwards n upwards!

Have a good day out there one and all.

Interbank Rate 09.10 BST GBPUSD   1.2877 EURUSD   1.1560 EURGBP   0.8977 GBPEUR   1.1138 USDJPY   110.40 USDCAD   1.3028 USDCHF   0.9845 GBPAUD   1.7545 GBPCAD   1.6777 GBPCHF   1.2674 GBPZAR   18.5633 GBPHKD   9.9835 EURHKD   8.9635

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