 Sterling's rebound extended further overnight as sentiment towards it continued to stabilized. Indeed, the Pound is trading up against Aussie and Canadian for the month. Sterling looks set to have a strong close for the week too. Commodity currencies are generally pressured today, together with steep decline in Japan Nikkei. But there is little risk aversion support to Yen. Dollar is mixed for now, overwhelmed by the comeback of Euro too. Technically, GBP/CAD is now pressing an important cluster resistance. The levels include 1.5296 resistance, 55 day EMA (now at 1.5292), and 38.2% retracement of 1.7375 to 1.4069 at 1.5332. Rejection by this cluster resistance, followed by break of 1.4728 minor support, will argue that the rebound from 1.4069 has completed. That will also maintain medium term bearishness for down trend resumption through 1.4069 at a later stage. However, sustained break of this cluster should add to the case that the worst is over for the Pound, and open up stronger rise back to 61.8% retracement at 1.6112. We'll probably find out which way next week. In Asia, at the time of writing, Nikkei is down -2.26%. Hong Kong HSI is down -0.25%. China Shanghai SSE is down -0.32%. Singapore Strait Times is down -0.43%. Japan 10-year JGB yield is down -0.014 at 0.245. Overnight, DOW dropped -1.54%. S&P 500 dropped -2.11%. NASDAQ dropped -2.84%. 10-year yield rose 0.042 to 3.747. |
