GBP/USD falls by 0.6% on the day now
Price now looks to break below the 1.2900 handle after moving below the 23.6 retracement level @ 1.2910. In a quick move, the low touched 1.2886. The next near-term support is the swing region close to 1.2850 followed by Monday's low at 1.2828.
Oil falls further
US Oil is currently at 58.71. This is despite the fact that Saudi Arabia cut 500K barrels for December and signalled that it looks like OPEC is going to cut production. One aspect that might be in play is the amount of Non-Opec oil production with US shale production increasing to record levels for next year. However, I am expected in the December OPEC meeting to be the catalyst to give some relief to the falling Oil market as they announce production cuts. Price is now moving through and beyond the 100 EMA and 55.00 looks a good long term place for a pause given the support that is there.
GBP/USD pares all of its losses from yesterday's trading
On the week, GBP/USD is now up by 0.03%. A continued push towards a breakthrough in Brexit negotiations is helping to lift the pound over the past few hours and that is fueling a commanding rally in cable with the dollar a little sluggish today.
Price action is jumpy as Brexit headlines are keeping traders (and algos) on edge
There wasn't much in this headline but it was enough for a good 30 pips pop higher in cable from 1.2930 to a high of 1.2961. At the start of a day, hopes of a November Brexit deal looked to be all but done and dusted. Fast forward eight hours later, suddenly all the headlines are priming a possible breakthrough in negotiations and a Brexit text will be agreed upon between UK and EU negotiators.
Price bias continues to favour sellers rather than buyers
Failure to get above the 200-hour MA (blue line) continues to highlight that near-term bias in the pair is still more bearish and despite the dollar struggling a little today, technical indicators don't lie.
WTI falls to a low of $58.33, nearing the low seen on 9 February at $58.07
All it takes is and that basically cancels out all the recent optimism surrounding possible production cuts by OPEC+ members. From the highs this year, oil is down by more than 24% and a bear market signature isn't going to help with sentiment at this juncture.
GBP/USD touches a high of 1.2905 on the day
There's no particular headline that I can attribute this to but once again, I'm a little skeptical in the rally today as this is coming ahead of the wages data to be released at 0930 GMT. And we've seen this kind of moves before in such circumstances.
NZD/USD is testing a break of the 100-hour MA for the third time this week
It's just not happening so far for NZD/USD buyers. The kiwi may be the only currency that is outperforming the dollar so far this week but there hasn't been any key technical breaks to be observed just yet.
GBP/USD is retracing some losses today, but downside bias remains in tact
The lows earlier today and overnight stalled at around 1.2840-50 with the previous swing region helping to provide some support. But also, it needs saying that the downside move yesterday occurred in a period of thin liquidity. Hence, price action tends to be a bit more exaggerated under such circumstances.
Cable is lower by 1.1% today to a low of 1.2828
It's been a painful day for the pound as it is getting crushed alongside hopes of a Brexit deal. GBP/USD is heading towards a test of support from the September low @ 1.2786 but considering how expectations of a Brexit deal is quickly vanishing, it'll be more of a pit stop before a continued dive towards the August low @ 1.2662.
The pound's downfall is what led to the dollar's outperformance
As mentioned earlier, the dollar may be leading the charge after EUR/USD broke below 1.1300 but it's the pound that is the number one driver in the currencies market today. The weakness in the quid due to Brexit woes led to a fall in the currency, which in turn dragged down the euro (alongside Italian budget worries), and that has led to the overall price action that we're seeing here.
USD/CAD is basically flat on the day trading at 1.3210
Friday's run higher failed to hold a daily break above the September high @ 1.3226 and that remains the key resistance level that is keeping the pair from breaking higher today. But the failure for buyers to retest the key level is more to do with the fact that the loonie remains underpinned on improved risk sentiment and also the solid rebound in oil prices.
The dollar continues to beat down the rest of the major bloc
The greenback is pulling further ahead on the session here after EUR/USD breaks below the 1.1300 handle. If you want to look at how major currencies are performing today, the pound's weakness is the main catalyst as the drop in the pound has led to a fall in the euro which broke the 1.1300 level against the dollar and in turn sparked a broad wave of dollar strength.
Stops taken out, quick move lower
Blink and you miss it. We're at 1.1269 now.
As earlier, on days like these, markets tend to be a little jumpy as thin liquidity makes it all the more likely to see price extension below key levels. But the bigger question is can it last?
Option-related bids near 1.1300 to provide additional support
It's going to be a very trick day for EUR/USD. Not because we're nearing a test of a key support level but more so the fact that we're closing in on that level in what will be a couple of sessions with thin liquidity. On days like these, price action tends to be a little jumpy and all it takes is a little skip and we could see price running away to the downside once 1.1300 gives way.
GBP/USD touches a low of 1.2901 on the day
It's been a continued march lower for cable since breaking below the 100-hour MA (red line) last week as buyers failed to maintain the near-term bullish bias as Brexit headlines continue to give sellers a reason to come back into picture.