US mid-term elections in focus.Pound has another Brexit round-trip
Monday 5 November 2018
We've been seeing some general US$ demand but the jury remains out as focus shifts to the US mid-term elections being held tomorrow and the electorate give their verdict on Trump thus far. Meanwhile Brexit still grabs some headlines and another Times report of a deal gave the Pound a spike higher on the Asia open before sellers prevailed again.
GBPUSD closed the week hanging onto support around 1.2960 but in thin Aisa-opening markets we saw a spike to look at 1.3050 again only to fall back to 1.2987 so far, with the sell-off increasing as European trading got underway. No smoke without fire perhaps re Brexit deal and plenty of similar moves ahead until we get the detail but we can expect some dip demand still. Sellers now poised between 1.3020-30 then 1.3050 and 1.3080 again, and 1.3100, 1.3120 and 1.3150 still.Immediate demand at 1.2980 then 1.2960, 1.2930 and 1.2900 again. I remain a GBP bear overall and rally seller for the moment happy to jump on positive Brexit news still but caution advised.
EURGBP fell to test the 0.8730 (GBPEUR up to 1.1456) area I mentioned on Friday on the GBP spike but recovered to 0.8772 before sellers jumped back in and we're steadying around 0.8750 for the moment. More buyers into 0.8730 still then 0.8700 with sellers now poised into 0.8780-85, 0.8800, 0.8830 and 0.8850. Key UK services PMI data,given the sector's circa 80% contribution to GDP, out at 09.30 GMT and will have short-term impact on the Pound if only algo-led before the bigger picture returns to the forefront of attention.
EURUSD rallied to test 1.1450 on Friday but since fallen back to 1.1373 before flat-lining between 1.1380-00 since. More bids/support now at 1.1350-60 where decent-size options roll off today then 1.1330 and 1.1300 where the barrier option defence still prevail. Sellers into 1.1400 with large option interest of its own today then 1.1430, 1.1450 again then 1.1480-00 still.
USDJPY has held 112.70-80 support and the on-going dip demand I've been warning about is still evident albeit with sellers keeping the range tight.Immediate sell interest again around 113.30 then 113.50 still with larger between 113.80-00.Bids/demand at 113.00 then 112.80 and 112.50, 112.30 and 112.00 still. I remain a rally seller buying back in the dips.
USDCHF dip buyers have once again prevailed after a sell-off to 0.9970 on Friday and we're back up to 1.0045 this morning,but remains underpinned overall with EURCHF still finding support in the dips. Bids/support now at 1.1420 then 1.1400 and 1.1380 still with more behind at 1.1350 but sellers poised at 1.1450-60 still then larger at 1.1480-00. USDCHF bids now at 1.0020 then 1.0000 and 0.9980 again with sellers poised now at 1.0060 then 1.0080-1.0100 again. Happy to trade both sides of the price action at the moment but preferring the dip buys still.
AUDUSD failed around 0.7250 again but has held 0.7180 on the retreat caused by general US$ demand. Immediate bids/support at 0.7180 and 0.7150 with sellers poised around 0.7230 then 0.7250, 0.7275 and 0.7300 again. USDCAD has rallied well to post 1.3119 with bids now at 1.3080 and 1.3050 again and sellers poised into 1.3130 and 1.1360. BOC Poloz up to the mic and in play today at 13.10
Fickle Forex markets ever prevailing so get your orders in to take full advantage of these moves.
Saturday saw the mighty Shrimpers of Southend United travel north again amid the most serious injury crisis we've had in many a year and despite some encouraging passages once again went down to a late winner. Grrrr but we go again and keep the faith. On a brighter note what a wonderful game of rugby we witnessed between England and South Africa eh?
Have a good week out there one and all, and if you're enjoying more fireworks tonight please stay safe.
Interbank Rate 08.00 GMT GBPUSD 1.2994 EURUSD 1.1381 EURGBP 0.8758 GBPEUR 1.1415 USDJPY 113.20 USDCAD 1.3110 USDCHF 1.0040 GBPAUD 1.8061 GBPCAD 1.7033 GBPCHF 1.3045 GBPHKD 10.0746 EURHKD 8.8257