Today has been the story of more summons, interdicts and other political rumblings for South African forex traders to deal with. Everyone from Zuma, Pravin, Julius and Madonsela looks like they are going to have their dealings looked into by the courts in one way or other. Zuma is looking more and more desperate by the day!
Yesterday’s FOMC minutes suggested a rate hike in the US was going to happen in December. The USD rallied against most other currencies last night and into this morning’s trading. The afternoon seems to suggest some profit taking and most Forex pairs are recovering some of the ground lost.
The EURUSD had managed to hold onto the big figure of 1.10 and is now about 50 pips off the session lows. Dean sees resistance at around 1.1063 – 1.1075 so any rally may be short lived.
Cable (GBPUSD) is marginally higher today but not really making much ground. The currency is trying desperately to find a foothold after such a big slide in recent days. More talk from European leaders saying that Brexit will be very hard on Britain has kept the lid on any rally. Support at 1.21 – 1.2150 seems to be holding. Most traders seem to want to trade this from the short side and any rallies will be a fresh opportunity to sell.
Dean was looking for long positions in the AUDUSD this morning. The general USD weakness would have suited his book and would imagine he found a long around 0.7515. We have a high around 0.7570 which is right in his resistance zone.
On the short side, Dean was looking at USDCAD. The dollar ran out of steam at around 1.3308 and is around 80 pips lower at the time of writing. Oil has been fairly flat so this has not come into play so far. I would imagine a trailing stop down to around 1.3250 would be sensible for those that managed to get short this morning. Support coming into play around 1.32 – 1.3220.
The USDJPY was also on the radar and this has proved an excellent call. Sellers moved in at 104.60 and we are now 100 pips lower. Old resistance often becomes new support and that is where we are now at 103.50. The initial move lower may be exhausted and we will watch how the market reacts here.
Tomorrow there is CPI data out of China, Zuma goes to court to prevent Madonsela’s report from being released and Fed Chair, Yellen, speaks at the Boston Conference. Retail sales in the US as well as the Michigan Consumer Confidence number should provide plenty of opportunities.
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