EUR – Chopping the mkt to pieces in this 1.29/1.3030 range – After a gd test and fail yesterday at that 1.3030 lvl we wiped the decks of longs to at 1.29155 low on the ldn open this morning. Trendline support from july lows comes in today at 1.2890/95 region so expect bids 00/10 with stops below. Like to buy a deeper dip towards that key 200day which is now at 1.2840, with a stop at 1.2780.
GBP – No UK data today. EUR/GBP continues to rumble lower, firstly on GBP strength as the market digests the strong GDP print and then, as stocks turn south, (s&p future cracks 1400) the EUR/USD leg outpaces cable lower. I’m square right now but look to reload EUR/GBP shorts 0.8055-80. Support/tech congestion at 0.8000-10, with European exporters already lurking on the bid. Good resistance now at 0.8115 will be the level to risk for shorts. Cable for me is a little tricky, as the USD is so vulnerable to equity markets right now. If you know where stocks are going next then have a go but you may as well place your bets on stock futures directly. Supply in cable is noted 1.6140-60 zone, with support 1.6084, 1.6063 and 1.6034. If stocks have a black day we could get a look sub 1.6, with the weeks recent wide range clearing out a lot of resting bids already. EUR/USD tech support 1.2900-20 would need to be breached for further decline in cable. Have a good weekend when you get there!
JPY – Disappointing price action yesterday post making that new high at 80.34 in ldn suggesting that the heavy profit taking we have been seeing this week is starting to feed through. Despite rallying in Asia to 80.38 we open in ldn at 80 and run a few stops down to 79.84 low. Few more stops on the downside 79.80-79.50. This 79.70 that has held well on the break up Monday will be crucial first off below there it feels like we get a chance to buy the dip to the 200 day (79.50) with a stop back at 79.05. Still like to buy a dip into BOJ on Tuesday feels like we may get a chance today – US gdp later could be a catalyst , all about whether we can regain a hold back above 80.00 by the close now or a deeper pullback feels possible.
AUD – We saw some good rm and model demand for AUDUSD around 1.0390 yesterday morning which was well absorbed with leverage offers packed around 1.0400. The USD caught a bid across the board on the coat tails of slippery stocks and as such AUDUSD found itself back down to 1.03 in the afternoon. Will be more stops through 1.0300 and with stocks through 1400 feels like these might be vulnerable having said that happy to be buying a dip in AUDUSD around 1.0260/70 on the day. NZDUSD had a bit of a wobble overnight inspired by Wheeler who must be drinking at the same establishment as Carney, scope to cut rates apparently which sent NZDUSD from 0.8220 to 0.8160 and hasn’t managed to get back above 0.8200 overnight. Still like selling rallies in NZDUSD back to 0.8250 where we have got RM offers. Good luck.
CAD – Fortunately Carney didn’t feel it was necessary to play headline wheel of fortune again yesterday and as such USDCAD had a relatively sensible day. Some custodial demand leading into the afternoon fix and stocks slipping kept USDCAD supported for most of our session trading from 0.9910 to 0.9950. Demand popping up from corporates in the orderbook around 0.9880/70 and stops remain above parity. We open this morning above 0.9950 but feels like we need to break above parity to gain any further traction on the topside. Until then still happy to play it from the short side, US GDP this afternoon will be the catalyst. Good luck. Resistance 0.9970 1.0000 1.0050. Support 0.9880 0.9820 0.9800.
Scandies – Rates unchanged from Riksbank sent EURSEK from 8.66 to 8.63 before the dovish messages hit the wires with lower repo rate path sending EURSEK through 8.70 resistance where local offers capped any further move higher. I think yesterdays news and the breach of 8.70 have re set us in a higher range for now where dips back to 8.63/64 will be bought and stops above 8.73/74 look to be in the markets crosshairs. GBPSEK above 10.80, fresh high for past several months also supporting EURSEK will be interesting to see if any model players come to the fore in this pair now. EURNOK has been bid into every WMR fix this week but I expect 7.48 and certainly 7.50 to offer good resistance, will certainly keep looking to buy the dip into next week initially around 7.42/43 on the day. Good luck. EURSEK support: 8.65 8.59 8.55 resistance 8.7150 8.74 8.80. EURNOK support: 7.42 7.35 7.30 resistance: 7.48 7.50 7.52.
ZAR – Stops flushed through 8.6800 yesterday, USDZAR trading to a low of 8.650 area. MTBS providing little direction for the local ccy as Finance Minister delivers a “Fiscally sound” budget. Ailing stock mkts however lead risk into the territory and ZAR follows suite, USDZAR goes bid and trades to 8.7750 on the open here with some fast money seen as early buyers of USDZAR. Expect range trading to continue with bearish ZAR bias intact. 8.7200-8.8200 range.
RUB – RUB opens weaker at 35.65 / 31.50 – we think its going to 35.85. Short rub is the right position – tax period is over this Monday.
CZK – More two way – corporates this time the seller met with spec and RM demand, but overall range remains subdued. We are still long with 24.85-90 now providing good support. Our target remains 25.10-20. Long EURCZK with SL under 24.80. 25.10-20 TP window.
PLN – Some profit taking early yesterday was met with decent EURPLN and USDPLN from RM. We expect to test our next target 4.18 soon, even 4.21. Absence of any official selling since Monday is not helping PLN longs. Stay long. Next target 4.18 then 4.21. Support now at 4.14.
HUF – HUF demand continues, with the govt saying they determined to exit the EU’s excess deficit procedure. . This might not be enough though in this risk negative environment. We’ve turned small long, looking for 282-283 again. We will cut it below 278. Long, SL 278 targeting 282-283 window.
Barclays Capital