Sterling Jumps on Reopening Optimism and Job Data, Risk Appetite Returning
Action Insight Daily Report 5-18-21

Sterling Jumps on Reopening Optimism and Job Data, Risk Appetite Returning

Dollar and Yen are both under pressure again today, as broad based risk sentiments improved. In particular, the volatile Nikkei managed to close up more than 2%. New Zealand Dollar is leading other commodity currencies higher too. But Canadian Dollar and Sterling are the strongest ones for the week at this point. The Loonie is lifted by WTI oil price, which is back above 66 handle. Sterling is booted by reopening optimism and slightly better than expected job data.

Technically, GBP/USD's break of 1.4165 resistance now puts focus on 1.4240 high. Firm break there will resume larger up trend from 1.1409. EUR/USD also looks ready to break through 1.2181 temporary top to retest 1.2348 high too. Similarly, USD/CHF is also ready to break through 0.8984 temporary low towards 0.8756 key support. Affirming dollar bearish developments, Gold broke above medium term falling channel yesterday. Now, we'd see if gold can sustain above the channel resistance to confirm completion of whole correction from 2075.18, at 1676.65.

In Asia, Nikkei closed up 2.09%. Hong Kong HSI is up 1.25%. China Shanghai SSE is up 0.06%. Singapore Strait Times is up 1.70%. Japan 10-year JGB yield is down -0.0011 at 0.079. Overnight, DOW dropped -0.16%. S&P 500 dropped -0.25%. NASDAQ dropped -0.38%. 10year yield rose 0.005 to 1.640.

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GBP/USD Daily Outlook

Daily Pivots: (S1) 1.4096; (P) 1.4121; (R1) 1.4165; More...

GBP/USD's break of 1.4165 confirms resumption of rise from 1.3668. Intraday bias is back on the upside to retest 1.4240 high. Firm break there will also resumption whole up trend from 1.1409 to 1.4376 key resistance next. On the downside, break of 1.4004 support is needed to signal short term topping. Otherwise, outlook will remain bullish in case of retreat.

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EURUSD | USDJPY | GBPUSD | USDCHF | AUDUSD | USDCAD

EURJPY | EURGBP | EURCHF | EURAUD | GBPJPY

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Economic Calendar
GMT Ccy Events Actual Forecast Previous Revised
23:50 JPY GDP Q/Q Q1 P -1.30% -1.20% 2.80%
23:50 JPY GDP Deflator Y/Y Q1 P -0.20% -0.10% 0.30%
1:30 AUD RBA Minutes
4:30 JPY Tertiary Industry Index M/M Mar 1.10% -0.10% 0.30%
6:00 GBP Claimant Count Rate Apr 7.20% 7.30% 7.20%
6:00 GBP Claimant Count Change Apr -15.1K 10.1K
6:00 GBP ILO Unemployment Rate (3M) Mar 4.80% 4.90% 4.90%
6:00 GBP Average Earnings Including Bonus 3M/Y Mar 4.00% 4.60% 4.50%
6:00 GBP Average Earnings Excluding Bonus 3M/Y Mar 4.60% 4.60% 4.40%
8:00 EUR Italy Trade Balance (EUR) Mar 4.75B
9:00 EUR Eurozone Trade Balance (EUR) Mar 20.3B 18.4B
9:00 EUR Eurozone GDP Q/Q Q1 P -0.60% -0.60%
9:00 EUR Eurozone Employment Change Q/Q Q1 P 0.10% 0.30%
12:30 USD Housing Starts Apr 1.71M 1.74M
12:30 USD Building Permits Apr 1.77M 1.76M