Up and down and in the middle
That’s for the majors. Risk on morning, risk off afternoon. GBP, CAD and the commod ccies rallied a last leg in the morning, so did USDJPY to give up the gains in the afternoon. JPY crosses dropped between 0.5 and 1% from their highs .The market doesn’t want to keep risk in the books ahead of what could possibly be.
At last kiwi found a top and lost ground for the first time really this week. MXN gained although Trump continues to verbally build the wall. That’s a catch up move on the CAD this week as Nafta negotiators want to speed up Nafta talks imo.Next week could be decisive, not to forget BOC and Canadian CPI on Wednesday/Thursday.
SEK weakened notably today as Riksbank continues to be (hidden) dovish and NOK finds bids on dips.
Finally RUB and TRY regained some colours after a dreadful week for both currencies. The TRY managed to hold on to the gained ground but Russia-US’ double whammy tensions prevented RUB to gain more ground.
The weekend is a big unknown. Are we going to get strikes, are there more China/Russia/US trade fights? We were talking in our trading room about the possibilities that may or not create a gap open on Sunday night.
-A targeted clinical strike in Syria, should not create to much of a downside gap open on Sunday as long as Russian positions would be avoided. Some banks or algo’s may go for initial stops but that should be short lived.
-Messier it would get if Russia-US(or the rest of the world) would conflict with each other more openly.
-Trade wars could also create additional animo but that’s possibly postponed as we remain on the threat, tweet and press shouting for now.
-The last option would be that nothing happens in which we could have a gap upside in risk on Sunday and Monday. That would see all crosses regain the lost ground and possibly a bit more. Would it last ?Probably not for long as the problems won’t be solved with one stroke of the brush.
Rest me to wish you all a peaceful weekend, to thank you for visiting us again this week. It’s been a great trading week as you will have read from our updates. We’ll do it again next week.
Love and Peace and stay safe.