GBP/USD Dips, USD/TRY Extends Rally, AUD/USD at Lows - US Market Open
GBP: Over the weekend, the EU had been seemingly less optimistic than Irish ministers, having stated that a lot more work would be needed in order to reach a deal with the UK. Consequently, GBP/USD is seeing a modest pullback from its recent short-covering led 4% rally. Going forward, Brexit related headlines will be the main focus in the run up to the EU Summit on October 17-18th, thus volatility in the Pound will remain elevated. On the technical front, the 200DMA at 1.2712 held firm while a larger pullback could see the 100DMA situated at 1.2409 in focus.
TRY: Geopolitical tensions are once again on the rise between the US and Turkey with the latter expanding its incursion in Northeast Syria. The Turkish Lira which has fallen 3.8% over the past week, has now lost over 12% in value vs the US Dollar for the year, risks remain tilted to the downside as the US increase talk over potential sanctions.
AUD / NZD: High beta currencies are notably weaker this morning as risk sentiment continues to ease with equity markets slightly softer. While President Trump may hail the recent Phase 1 agreement of trade talks with China as a breakthrough, China still demands additional talks before signing a Phase 1 deal, thus ebbing trade optimism has pressured risk assets. Looking ahead, both the Aussie and Kiwi will be awaiting key economic data releases throughout the week.
Source: DailyFX, Refinitiv
WHAT’S DRIVING MARKETS TODAY
- “GBP/USD Price Slips Lower as Brexit Reality Starts to Bite” by Nick Cawley, Market Analyst
- “Euro Shorts Increase Sharply, GBP/USD Less Bearish, USD Bulls Rise - COT Report” by Justin McQueen, Market Analyst
- “FTSE 100 Outlook: Familiar Level in Play, Pattern Possibilities to Watch” by Paul Robinson, Currency Strategist
- “Using FX To Effectively Trade Global Market Themes at IG” by Tyler Yell, CMT , Forex Trading Instructor
--- Written by Justin McQueen, Market Analyst
To contact Justin, email him at Justin.firstname.lastname@example.org
Follow Justin on Twitter @JMcQueenFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.