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The buzz on the street today centred on Bitcoin as it soared over another $ 1,000 and now trades well over $ 11,000 – this leaves the cryptocurrency returning over 700% on the year. There is plenty of volatility in this area, it is still an asset class that I am not trading in, I am happy to make a living trading more traditional asset classes. I am not convinced yet by cryptocurrencies as most of the move has been driven by speculation, I am also concerned that central banks around the world could effectively “pull the plug.”
The FX market was also very choppy, this has been an event filled week and the both the testimony by Janet Yellen and the US GDP report gave the dollar a slight bid on the day. Rumours that the UK and the EU have agreed on a Brexit settlement continue to underpin the GBP and the sterling has been a very strong performer this week.
The GBPUSD is now trading at its highest level in 3 months and broke through the top trend line at 1.3450 early this morning, this was key resistance for most of yesterday. The swing high stretching back to the Brexit announcement in 2016 were 1.3480 to 1.3530, this trade is clearly a fundamental play at the moment and I still believe that the right decision to do will be to use these rallies to build offers.
There does not look to be any obvious set ups this morning, I am keeping an eye on both cable and the USDCAD – both are covered in more detail in the morning video.
Market Insight Commentary – Forex
In the Zone
- GBPUSD
- USDCAD
- USDJPY
Market Insight Commentary – Indices
Important Economic Data out today
12:00 EUR CPI
Consensus: 1.6%
Effect: Actual higher than expected is good for the EUR
15:30 USD Unemployment Claims
Consensus: 241K
Effect: Actual lower than expected is good for the USD
Noteworthy News
- Despite the rumours out of the UK regarding the Brexit settlement, the EU are reporting that there has been no major developments – I guess it comes down to which side you believe, this week the market seems to believe the UK, but that could change at any time.
