FXTM information and reviews
OctaFX information and reviews
XM information and reviews
FXCC information and reviews
FxPro information and reviews
HFM information and reviews

Respect is Within Reach!

22 October 2020

The Pound is the clear winner today after the EU’s chief negotiator Barnier said in a speech to the European Parliament this morning that an agreement with the UK was within reach. Even more positive, he stated that the EU was not out to challenge the UK’s independence, saying that the EU’s stance in talks is ‘fully compatible with the respect of British sovereignty.’ This address has gone a long way to easing tensions between the two sides and the aim is now for a deal by mid-November.

As we mentioned yesterday, political ‘deadlines’ are often much more flexible than initially thought, and so it turns out with Nancy Pelosi’s Tuesday time limit. Although the chances of a large scale deal that get through the Senate this side of the election are fading, stock markets are once again taking the ‘half-full’ approach and fully expecting a multi-trillion dollar stimulus at the start of next year with a Blue, Democratic sweep.

This is denting the dollar and pushing bond yields higher as the reflation trade gathers pace. We’ve seen increased bear steepening in fixed income recently, where long bond yields rise faster than shorter-term yields. In fact, the ten-year US Treasury bond yield hit levels earlier today not seen since the start of June.

EUR/GBP drops into strong support

With the positive Brexit news (well, the fact that talks are due to resume after a week of negative headlines!), the Pound has reacted strongly with cable surging past the mid-October high of 1.3083 and the 50% retracement of the September decline at 1.3079. There now seems to be a clear path to 1.32 after range trading over the past few weeks.

Similarly, EUR/GBP has moved abruptly lower today and is trading on its 100-day Moving Average and into strong October support. More Brexit optimism is now needed to break this confluence zone just above 0.90, so bears can push lower towards 0.89.

USD/JPY through 105

As US bond yields rise, so USD/JPY falls with technical selling through the 105 level spurring increased bearish momentum. Negative sentiment around King Dollar and the prospects for increased US government borrowing have sparked the selloff in bonds.

The downward trajectory has taken the pair to fresh one-month lows, but the biggest sell-off since August needs to consolidate these lows after such a strong move. Further weakness should challenge last month’s swing lows around the 104 mark.


Share: Tweet this or Share on Facebook


USD Index extends the breakout of 102.00 ahead of data
USD Index extends the breakout of 102.00 ahead of data

The index moves further north of the 102.00 barrier. The Fed starts its 2-day meeting later on Tuesday. CB Consumer Confidence, housing data next of note in the docket...

31 Jan 2023

Dollar flat as market braces for central bank decisions later in the week
Dollar flat as market braces for central bank decisions later in the week

The dollar was up modestly in early trading in Europe on Monday, at the start of a key week for central bank meetings on both sides of the Atlantic. By 03:00 ET (08:00 GMT), the dollar index...

30 Jan 2023

Mega Central banks, OPEC, NFP & Earnings week
Mega Central banks, OPEC, NFP & Earnings week

China Stock market returns from Luna New Year break. Chinese stocks rose while most other Asian equities fell as investors looked to interest rate decisions scheduled this week in the US...

30 Jan 2023

XAU/USD remains on the defensive around $1,925 ahead of US PCE
XAU/USD remains on the defensive around $1,925 ahead of US PCE

Gold price remains on the defensive for the second straight day amid modest US Dollar strength. Thursday’s upbeat US macro data fuels hawkish Fed expectations...

27 Jan 2023

XAU/USD retreats from multi-month top amid modest USD recovery, ahead of US GDP
XAU/USD retreats from multi-month top amid modest USD recovery, ahead of US GDP

Gold price pulls away from a fresh multi-month top amid a modest US Dollar strength. Bets for smaller rate hikes by Federal Reserve, recession fears should help limit losses...

26 Jan 2023

Microsoft: Still Trapped Within Descending Channel
Microsoft: Still Trapped Within Descending Channel

Microsoft Corp., an American multinational technology conglomerate currently ranked the third largest company by market capitalization ($1.728T) which actively engages...

24 Jan 2023

Editors' Picks

FXCM information and reviews
ActivTrades information and reviews
RoboForex information and reviews
MultiBank Group information and reviews
MultiBank Group
Libertex information and reviews
Vantage information and reviews

© 2006-2023 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.