GBP/JPY at 4-day high, but risk reversals hit 9-day low

GBPJPY extended yesterdays 200pip rally to a fourday high of 152.64 in Asia on reports that reports that the UK Ireland and the EU are working through the night to try and reach a breakthrough on Brexit negotiations.A formal announcement is expected today. Hence Sterling is trading higher across the board. Still investors are cautious which is evident from the drop in the risk reversals gauge.The onemonth 25 delta risk reversals gauge dropped to 1.25 yesterday the lowest since Nov. 29. The decline indicates increased (hedge) [read more]

USD/CHF downside pressure mitigated above 0.9911 – Commerzbank

In opinion of Karen Jones Head of FICC Technical Analysis at Commerzbank [read more]

GBP/USD stays bearish, within 1.3065/1.3321 – UOB

In view of FX Strategists at UOB Group Cables outlook remains bearish in [read more]

EUR/GBP: another run at 0.90 highs not to be ruled out - Westpac

Analysts at Westpac explained that sterling remains mired in a twomonth trading range [read more]

EUR/USD dips expected to terminate near 1.1740/20 – Commerzbank

Karen Jones Head of FICC Technical Analysis at Commerzbank sees occasional retracements in spot [read more]

EUR/USD negative, still targets 1.1263 – Commerzbank

Karen Jones Head of FICC Technical Analysis at Commerzbank noted the pairs outlook remains negative and the next targets is the 200day sma in the 1.1260 area Key Quotes EURUSDs outlook stays negative the market last week closed below 1.1662 the 17th August low and is struggling very near term to regain this resistance. It has recently completed a head and shoulders top pattern 1.20921.1662 targeting 1.1232. Given the close proximity of the 200 day ma at 1.1263 we will make this [read more]

Australia Q3 CPI: Inflation comes in under expectations, again - Westpac

Justin Smirk Research Analyst at Westpac notes that in the third quarter the Australian CPI rose 0.6% for an annual pace of 1.8%yr while the average of the core measures rose 0.4%qtr1.9%yr. Key Quotes Australia is locked in a low inflation environment What was surprising in the September quarter was that the components of the CPI came in broadly as we expected hence our below market forecast of 0.7%qtr on headline inflation and 0.3%qtr forecast for core inflation was very close [read more]

CNY: Overall stability is maintained - Westpac

CNY has been trading on the weak side but overall stability is maintained according to Frances Cheung Research Analyst at Westpac.While some market observers have the impression that President Xi is not aggressive on market reform we note that this market reform term years back was referring more to merchandise trade and investment rather than capital marketsFX as we understand currently. We suggest that investors do not read too much into it. CSRC Liu said China would continue with capital market opening. Prior to the NPC PBoC [read more]

EUR/USD - Bond yield spread reverses course, is a trend reversal on the cards?

EURUSD pair fell to a fourday low of 1.1728 on Friday after the US July nonfarm payrolls number bettered estimate and wage growth ticked higher as expected.The spread or the difference between the US 10year Treasury yield and the German 10year Bund yield increased to 179 basis points from 177 basis points. The chart above shows a bullish break of the falling channel on the USGerman 10yr yield spread chart. It indicates a scope for further widening of the yield spread in favor of the USD.Options activity shows bearish move could gather pace below [read more]