The British pound came in for some heavy volatility yesterday on Theresa May’s pledge to hold a referendum, but with the kicker that this would only be if PMs vote for her deal in parliament. Market’s initial excitement was tempered by the reality that PMs are still unlikely to go for the deal, even with the temptation of it triggering a referendum.
The GBP/USD is unchanged at 1.2700 and failing to check the down trend after a brief foray higher yesterday. The EUR/GBP is setting up for its first reversal since the beginning of the month however as the euro struggles ahead of European elections. The GBP/JPY managed to close higher yesterday (though well below the lows), with a return to selling pressure this morning.
The dollar index is challenging the highs as traders seek out safe havens despite a suspension of the precarious Huawei ban.
After an opening gap higher, the AUD/USD is extending its losing run, with the lows below 0.6886 the next test. The EUR/USD is struggling to hold the 1.1150 support level.
The USD/JPY is on the back foot as the dollar loses ground to the safe haven yen. The EUR/JPY is erasing most of yesterday’s gains, while the EUR/JPY is back below 76.00.
Coming up today
UK CPI, PPI and public sector net borrowing are at 08.30.
Canadian core retail sales are at 12.30.
FOMC member Williams speaks at 14.00.
The latest FOMC meeting minutes are at 18.00.
Trade Idea
The AUD/ JPY is in a difficult position, with the weakening Aussie, meeting the strengthening yen.
Morning Report: 07.00 London
The British pound came in for some heavy volatility yesterday on Theresa May’s pledge to hold a referendum, but with the kicker that this would only be if PMs vote for her deal in parliament. Market’s initial excitement was tempered by the reality that PMs are still unlikely to go for the deal, even with the temptation of it triggering a referendum.
The GBP/USD is unchanged at 1.2700 and failing to check the down trend after a brief foray higher yesterday. The EUR/GBP is setting up for its first reversal since the beginning of the month however as the euro struggles ahead of European elections. The GBP/JPY managed to close higher yesterday (though well below the lows), with a return to selling pressure this morning.
The dollar index is challenging the highs as traders seek out safe havens despite a suspension of the precarious Huawei ban.
After an opening gap higher, the AUD/USD is extending its losing run, with the lows below 0.6886 the next test. The EUR/USD is struggling to hold the 1.1150 support level.
The USD/JPY is on the back foot as the dollar loses ground to the safe haven yen. The EUR/JPY is erasing most of yesterday’s gains, while the EUR/JPY is back below 76.00.
Coming up today
UK CPI, PPI and public sector net borrowing are at 08.30.
Canadian core retail sales are at 12.30.
FOMC member Williams speaks at 14.00.
The latest FOMC meeting minutes are at 18.00.
Trade Idea
The AUD/ JPY is in a difficult position, with the weakening Aussie, meeting the strengthening yen.
There could be further downside from here and a good way to play this is a LOWER trade predicting that the AUD/JPY will close below 75.50 in 14 days for a potential return of 166%.
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