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Sterling

Pound fell sharp as BoE Gov Bailey not seeing V shaped recoveryThe Bank of England asked banks on 12th October on how ready they are for zero or negative interest rates, following up its announcement last month that it was considering how to take rates below zero if necessary. The BOE set a deadline of Nov. 12 a week after its next monetary policy announcement for banks to respond. Money Markets are expecting BOE's next move to be an increase in the 745 billion Pound bond buying program in November. Technically, GBPUSD came out fom upward rising channel in 4hr with a break of channel support at 1.2960 or 50ma heading towards 1.2845-50 Oct 10th low. A break upside 50ma again can rise towards 1.2980 or 200ma and 1.3082 Oct 12th high. As we see a small retrace to the todays pivot point at 1.2955-60 would be a selling zone freshly for downside said targets. Overall sell on rise is advised for the day. Suggestion: SELL GBPUSD FROM 1.2950-60 SL ABV 1.3030 TGT 1.2880/2830 ELSE BUY GBPUSD FROM 1.3030 FOR 1.3120 WITH SL BELOW 1.2950
Short
by OfficialYaMarkets
POUND STERLING COT. GJ EXCHANGE COT. All LONG but Fibogroup. POUND STERLING COT. GJ EXCHANGE COT. All LONG but Fibogroup. GBP Futures COT CME Big Long / Retail Short. COT GJ Overall Sentiment Long. Most Retail Exchanges Long but Fibogroup in Austria 56% Short. i don't think i'm aloud to leave links but google FXSSI current ratio. :) luv u buddys OANDA:GBPUSD BRITISH POUND STERLING - CHICAGO MERCANTILE EXCHANGE FUTURES ONLY POSITIONS AS OF 09/29/20 | --------------------------------------------------------------| NONREPORTABLE NON-COMMERCIAL | COMMERCIAL | TOTAL | POSITIONS --------------------------|-----------------|-----------------|----------------- LONG | SHORT |SPREADS | LONG | SHORT | LONG | SHORT | LONG | SHORT -------------------------------------------------------------------------------- (CONTRACTS OF GBP 62,500) OPEN INTEREST: 159,049 COMMITMENTS 39,216 51,961 5,384 88,988 78,464 133,588 135,809 25,461 23,240 Retail Exchanges in the COT FiboGroup Austria . 56% Short IGG Chicago Dukas Swiss, Saxo Denmark. Oanda New York Insta Cyprus . only 50.7% long :slot_machine: :slot_machine: :slot_machine: :slot_machine: I’m not short. I'm looking to short. I'm looking to get in and get out. I'm looking to Long Dollar. I'm looking to stack pips into cash. I'm looking for 10 pip 10 lot cup o coffee afternoons. We'll see, someday, til then: self brew'd teaspoons, middle of the night.
Short
by allthemoneys
What are the banks saying about EUR, USD, JPY and GBP?I receive bank research each day... I'll drop some of their comments here/ Euro Citi: EUR trades marginally below overnight highs around 1.1730 at the time of writing (-0.1% in Asia). As a reminder, CitiFX Strategy still believes the EURUSD correction has room to go and it is not yet time to fade it. Several factors, including a slightly less dovish Fed, derisking into US elections, and USD positioning all support this thesis. Strategy is still structurally bullish EURUSD but prefers to add longs on a deeper correction towards 1.14. JPMorgan: No real reason for the move higher yesterday and it was a little strange when you consider that stocks and commodities were lower on the day. But the head scratching wasn’t confined to EURO, where EM which ignored the positive risk rally on Monday, chose to rebound into midday, before retracing somewhat. The random price action could be a result of Month/Quarter end flow and while I have no insight into whether this is indeed the reason or not, this afternoon is likely to be volatile as the story plays out. O/N the Biden/Trump presidential debate was at times farcical, as both candidates thought the way to make an impact was to name call and see who could shout the loudest. While there was no clear winner, Biden’s betting odds widened by 7% points and the Election remains his to lose. While Biden extended his lead, it was clear that Trump is unlikely to go quietly, meaning a contested election is still very much a concern for markets. But with polls suggesting that 87% of Americans have already made up their minds on how they will vote, these debates may be nothing more than a 3 part Comedy drama. Watch the wires for headlines as Lagarde and Lane are due to speak at today’s ECB watchers Conference and Brexit discussions continue. Mnuchin and Pelosi also continue to talk although an agreement still feels unlikely. All of this may be insignificant, if the much anticipated Month/Quarter end flow dominates proceedings as expected this afternoon. We had been tactically short EUR/USD but are now playing things very close to home, as we try to navigate the potential volatile moves this afternoon. ING: EUR: All eyes on Lagarde USD weakness helped EUR/USD yesterday absorb the new of a possible delay in the EU Recovery Fund as some countries look determined to use the veto if the rule-of-law conditions are not dropped. Today, the pair appears more vulnerable, also due to some potential Brexit spill-over. President Lagarde’s comments will be closely watched amid rising speculation over a rate cut. Danske: Although EUR/USD is again on the rise, sentiment across inflation expectations, equities and credit continue to appear weak, and it is, in our view, too early to call off further downside in the pair. Indeed, to the extent that the Danish experience with new COVID-19 lockdowns is anything to go by in a broader context, it is worth noting that consumer spending (card and mobile payments data) are starting to show signs of weakness. We still view EUR/USD as rangebound with risks tilted to the downside towards 1.16 near term. What could make us change this view? Progress on Brexit (watch for whether 'tunnel' negotiations are reached this week), a 'clear' US election outcome and thus a US fiscal boost, and/or central banks renewing their reflation vows. Today watch for ECB speakers at the Watchers conference and for Fed minutes for any hints on the latter, although we think it is too early for a major shift on either side of the Atlantic. GBP Citi: GBP mirrors AUD movement, trading down -0.2% to 1.2840 at the time of writing. After the London close, headlines on Bloomberg emerged that the EU has rebuffed a new round of UK proposals on state-aid rules. “The British offer still doesn’t go far enough, according to two officials in Brussels, who said insufficient progress has so far been made for the talks to head into the intense final phase, known as the tunnel, at the end of this week.” Talks will continue before a meeting on Friday between chief negotiators Barnier and Frost, where yet another round of talks could be proposed to iron out remaining differences, should no breakthrough be found this week. CitiFX Strategy’s Adam Pickett outlines expectations here: Nothing new from Brexit and BoE headlines. Also note that the EU’s deadline for changes to the UKIM Bill is today – infringement proceedings against the UK are expected to start on October 1. JPMorgan: Choppy day for sterling yesterday in which we saw much of Monday’s strength reverse as talks continue in Brussels, the highlight of the day were reports that the UK had sent 5 draft legal texts including one on state aid i n an effort to advance the talks however subsequent reports had European sources saying that the proposals did not go far enough and that insufficient progress has been made to enter the tunnel phase. Flows were pretty light although the HF sector did turn to small net sellers tempering the exuberant run (4 sessions) of net buying into the talks. The IMB meanwhile trundles on clearing the HoC hurdle and now moving to the House of Lords in which it should fail –what follows is then an iterative process between the two houses after a few rounds of which Johnson will be able to force it through anyway –developments here are unlikely to impact negotiations this week. The situation will remain opaque and will be punctuated by brief noises in either direction –our overarching suspicion is that political leaders will need to get involved to agree on the thornier issues and thus the tone could take a turn for the worse into the end of the week. As such we remain in tactical mode here as we end the teeth of month and quarter end rebalancing today. 1.2780/90 remains supportive ahead of 1.2740/50 (0.9115/20, 0.9065/70 EURGBP) while 1.2880/85 remains resistance with 1.2930 above (0.9165/70, 0.9220/25 EURGBP). Lloyds: The rally from 1.2675 has backed away from 1.2935/45 resistance. A move through there opening an extension towards 1.3010/50 with a break there suggesting 1.2675 was a meaningful low. A slide back through 1.2805/1.2780 support would suggest the rebound from 1.2675 is merely another correction risking another test lower to the 1.26-1.25 region. Longer term, we are biased that the bear cycle from the 2007 and 2014 highs completed with a major ‘double bottom’ in the 1.15-1.14 region. However, we are monitoring the current pullback closely and watching 1.25 and 1.20 key supports. USD Citi: Month-end: CitiFX Quant’s preliminary estimates have also suggested that USD pressure should prevail. The sharp losses in equities in September leads the asset rebalancing model to suggest a rotation into equities from bonds with a moderately strong signal at +0.8/-0.7 historic standard deviations respectively. The FX impact of the signals is likely to be USD buying, with the signal significant by historic standards (over 2 standard deviations). JPY JPMorgan: Biden seemed to hold his own as Trump turned the debate into chaotic theatre and while Biden’s advantage in betting odds has grown ~7% overnight it is also becoming clearer that Trump will not go quietly, the risk of a contested election is very real and probably rising –as such risk is trading on a softer footing for now. However price action today will be increasingly hard to put into context as we have month/quarter end to deal with –USDJPY was pretty bid in Tokyo into Japanese half-FY and go to be touching resistance at 105.75/80 yet again before risk turned, this will be a focal point today should the implied rebalancing (from MTD stock divergences) come to pass. We are looking to sell USDJPY further onto a 106 handle today if we get the chance, through105.75/80, 106.50/60 is the next level above, meanwhile 105.20/25 remains solid with 104.85/90 below.
AMEX:XLF
by FinkPro
21
Sterling shows bullish tone on tuesday,is it fading again?Sterling held onto a moderately bullish tone Tuesday, recording a fourth consecutive daily gain. From a technical standpoint, H4 recently knocked on the door of 1.29, a level that’s withstood two upside attempts this week. In spite of this, sellers offer a non-committal tone at the moment. As having said, 1.29 is proving a problematic hurdle to overpower on the H4 right now, despite the higher timeframe supports in sight. Yet, given the lacklustre show from sellers here, a 1.29 breach is still potentially in store. Above 1.29, the river north on the higher timeframes appears ripple free until daily resistance at 1.3017, which happens to merge with the key figure 1.30 and H4 resistance at 1.3009.Dip-buying at any retest seen at 1.28 remains a possible scenario (should intraday sellers strengthen their grip).Another setup worth keeping a tab on is a H4 close above 1.29, signalling bullish scenarios in favour of reaching the 1.30 range. Irrespective of the support used, conservative traders are likely to seek at least additional H4 candlestick confirmation before committing.
Short
by OfficialYaMarkets
Weak dollar pushing pound to above 1.29 handleTechnically, GBPUSD holding abv 1.28 handle strongl and heading for 1.29 and sustain abv can test 1.32. Intraday perspective h4 chart holding above 50ma at 1.2822 and h1 200ma at 1.2822 saying 1.2820 a strong support for the day. One can build a buy positions for the upside target 1.2920 yesterday high also a 136ma too in h4, followed by 200ma at 1.3045 h4 timeframe. Overall buy on dips is advised for the day. Suggestion: BUY GBPUSD FROM CMP 1.2855 SL BELOW 1.2800 TGT 1.2920/2950 ELSE SELL BELOW 1.2800 FOR 1.2755/2730 SL ABV 1.2830
Long
by OfficialYaMarkets
FX Update: European mood brightens and sterling surgesSummary: The mood across markets has brightened further in Europe on smooth Brexit hopes driven by the news that major London clearinghouses will retain access to the EU after December 31. This has EURGBP eyeing downside pivot levels. Elsewhere, things are looking a bit less bright as the strong US dollar weighs on sentiment for EM currencies and even among the small G10 currencies. Sterling was already showing signs of resilience late last week, in part on lowered expectations that the BoE is looking into an imminent move to a negative rate policy (BoE’s Ramsden using those words almost exactly in the minutes after I am writing this, as he sees the effective lower bound at 0.1%), but also on a suddenly more positive tone from informal Brexit talks that were somewhat drowned out over the furor over negative policy rate considerations recently. The Brexit talks are set to get more formal this week and starting tomorrow, with this round seen as a last dash effort if any agreement is to be made on Boris Johnson’s timeline aiming for mid-October agreement. Particular focus from the EU side will apparently be on how any trade deal will be enforced after the recently passed Brexit bill could walk back key portions of the Withdrawal Agreement, which effectively stipulated a customs border across the Irish Sea (separating Northern Ireland from the rest of the UK.) A specific headline supporting sterling this morning was the news from ESMA (Paris-based European Securities and Markets Authority) that the UK’s clearinghouses for derivatives, energy and metals trades will be able to continuing doing business with EU financial institutions after the December 31 end of the Brexit transition period. This is hugely important as the derivatives portion of the above includes things like the global settling of USD, GBP and EUR swaps. Chart: EURGBP EURGBP is pressing back lower toward what is arguably the downside pivot area around 0.9000, which would begin to fully reverse the early September spike inspired by Boris Johnson’s new move to get the Brexit Bill in place. Still, the action will remain highly headline dependent over the next week and more into mid-October on whether we are moving toward a deal. Positioning for a directional move in options is a way to trade outcomes for those fearing the large swings in the spot exchange rate until we either get a deal or a hard Brexit. For the former a long put spread expiring 8 Jan 21 with strikes of 0.88 and 0.86 cost about 56 pips offering almost 3 to 1 reward-to-risk. Strikes farther out of the money offer better multiples if the underlying trades down to the lower strike. Elsewhere, the strong mood in Europe this morning is not providing notable positive contagion into emerging markets, where the USD strength is beginning to hurt. An FT article (paywall) this morning points out the scale of EM borrowing (some $100 billion since the outbreak of Covid-19) and rightly wonders at the ability for emerging markets to repay this debt. With USD liquidity growth slowing from the initial huge splash, the risk to EM is enormous if the resurgence of Covid-19 or any other threat keeps the global recovery weak or worse. US political dysfunction is another risk across markets as well, keeping new US stimulus possibly bottled up until after a new US Congress sits in January. One EM currency that may be eyeing specific outcomes is the Russian ruble, as USDRUB accelerated higher to close last week in a move that doesn’t seem particularly driven by oil fundamentals. Ruble traders and owners of Russian assets may be eyeing the strength of Joe Biden in the US election polls, as Biden and the Democrats are seen as likely to be far less friendly to Russia than Trump on accusations of prior interference in US elections and the poisoning of Russian opposition leader Navalny. The ruble is close to its Covid-19 panic lows than most other major EM currencies, save for the Turkish lira, where even last week’s 200 basis point hike failed to stem the selling, with the lira tumbling to new cycle lows this morning. The G-10 rundown USD – the USD strength beginning to ease somewhat by lunchtime in Europe on very strong risk sentiment all morning long in Europe. Considerable work to be done by the USD bears to reverse the recent rally impulse. EUR – as noted in today’s Saxo Market Call podcast, European banks are in the dumps, with the broad banking index of equities touching its lowest level since the 1980’s. Is there any EU recovery without a proper cleanup of the banking system? The mood is very positive today, but let’s see if that lasts. JPY – the Japanese yen is hanging in better than one would expect on a day in which European equities are ripping some 2-3% higher. Part of the resilience likely down to sympathy with USD moves in the crosses and a local weakness here in the reflationary narrative (commodity prices GBP – sterling firmer on the developments noted above and plenty more where that came from if we get clear signals that the two sides are moving toward a deal later this week as the latest Brexit talks get under way tomorrow. CHF – the positive mood in Europe rubbing off ever so slightly on CHF, with EURCHF have a poke at 1.0800 again this morning - the bigger level there is 1.0900. The latest weekly sight deposit data showed negligible change (no real intervention ongoing last week). AUD – the Aussie is disappointing here, suggesting that the story for the Aussie is more linked to commodity prices and the reflationary story more than risk sentiment per se, as liquid, risky assets are putting in a stellar performance today, while iron ore remains stuck near a two-month low. Still, structural weakness for AUDUSD only really arrives with a forceful move below 0.7000. CAD – the USDCAD bounce has been gentler than the USD bounce elsewhere, with CAD showing its tendency to track USD direction in crosses like AUDCAD (big mover that one recently) NZD – the kiwi generally following the Aussie’s lead, though in the AUDNZD cross, the kiwi extended aggressively stronger last week – the latest distraction is the 1.0750 area, the last major Fibo (61.8%) of the rally wave from July and August, though bulls there need a negative NZD catalyst and move above 1.0800-50 to rekindle their hopes. SEK – the positive mood in Europe rubbing off more easily on SEK aftter EURSEK shot above its 200-day moving average last week, likely on doom-and-Covid-19-gloom. Lets’ see if that moving average, now near 10.56 provides any support. NOK – the krone suffered a brutal decline last week and risk-on in Europe is finally seeing the currency put in a show of support. A lot of work to do to reverse the damage. John Hardy Head of FX Strategy Disclaimer The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. 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by Saxo