• Pound tumbles as US Dollar demand continues

    It was a day of carnage for the Pound with the Aussie Dollar also following suit, (accelerated by RBA cutting cash rate to 0.25%), as the incessant USD demand continues as I've been warning. GBP pairs took a further hit on news that the UK will not look to extend the Brexit transition period and then overnight reports of an impending lockdown in London at least, if not many other places too. These are unprecedented times and the extent of moves can never be accurately forecast but hopefully my general steer is continuing to help.

    Last night the ECB added an extra 750 billion Euros of QE meaning they will be doing an extra 115b per month, The SNB has left policy rate at -0.75% but raised the negative rates exemption threshold to 30 from 25 and said they will intervene even more in FX markets. Early European trading has seen mixed risk sentiment but some small positive vibes as I type. Overall though this situation is not getting better any time soon.

    As I've said a few times this week please feel free to contact me on any of the current issues and impact on FX markets in these very difficult times. I would also like to hear from you to let me know whether you are still trading through all this turmoil or reducing your activity for whatever reasons your own finances may dictate. How may I help further/guide you in these difficult times?

    GBPUSD has been slapped down to lows of 1.1452, not seen for over 35 years with GBPJPY and GBPCHF supply helping to push it down along with the general USD demand. EURGBP broke out through the topside 0.9160 resistance and tested 0.9500 (GBPEUR down to 1.0510. GBPJPY has tumbled to 124.08 before bouncing as USDJPY enjoys further USD demand and rallies to 109.56 but sellers poised as ever including me still.

    I stay poised to sell GBP rallies and buy back in the dips as ever.Always difficult to judge the level of retracement after such big moves but with the Coronavirus scenario accelerating at rapid pace in the UK I still see continued weakness.

    USDJPY rallies continue to be contained between USD and JPY demand but has broken higher to post 109.82. EURJPY has been down to 116.91 before bouncing strongly to 119.20 as core pairs both find dip demand.EURUSD has dropped further to post 1.0803 amid the general USD demand but recovered well on some funding currency demand to post 1.0980 only to run into rally sellers again. Jury out on the ECB's latest QE move.USDCHF has posted fresh recent highs of 0.9754 amid the same pattern of EURUSD falling and EURCHF holding that evident SNB line in the sand at 1.0540 that I've been highlighting but testing again now as I type. The SNB's statement this morning may have an early opportunity to be fully tested.

    AUDUSD has tumbled further to post 0.5507 amid the general USD demand, RBA rate cut, iron ore falling and ongoing AUDJPY supply while USDCAD has surged further to post 1.4668 on the lower oil/USD demand/risk-off triple whammy still but in retreat this morning to post 1.4480 as I type.

    Fickle Forex markets ever prevailing so be ready to jump on moves with your orders as always. Caution advised as ever if you're not sure.

    Lots going on right now, and the foreseeable future, so don't forget that I offer 1-2-1 mentoring if there's areas of trading these volatile markets or how to make best use of the order boards and expiries, that you might need some further help with.

    Let's continue to be careful out there in all things as ever. Staying safe must be our main priority.

    Twitter: @MSPFX and @MikePatersonFX

    Interbank rates: 07.55 GMT

    GBPUSD 1.1491

    EURUSD 1.0858

    EURGBP 0.9443

    GBPEUR 1.0584

    GBPAUD 2.0224

    GBPCAD 1.6701

    GBPJPY 125.40

    GBPZAR 19.9654

    GBPHKD 8.9090

    USDJPY 109.07

    USDZAR 17.3033

    EURJPY 118.38

    EURCHF 1.0550

    EURHKD 8.4174

    AUDUSD 0.5700

    USDCAD 1.4521

    USDCHF 0.9721

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