Sterling Down as Risk Sentiment Turns Weaker, Dollar Trying to Rebound
Action Insight Mid-Day Report 9-7-21

Sterling Down as Risk Sentiment Turns Weaker, Dollar Trying to Rebound

Risk sentiment turns a bit weaker today in the stock markets. But benchmark European and US yields are staging a strong rally. In the currency markets, Aussie is sold off is in delayed reaction to RBA's dovish tapering, but Canadian is follow closely with selloff in oil price. Sterling is also falling in European crosses, probably in reaction to the government's plan to raise taxes. On the other hand, Dollar is trying to rebound, other with Euro and Swiss Franc.

Technically, EUR/GBP's break of 0.8601 resistance suggest resumption of rise from 0.8448 for 0.8668 resistance. We'll keep an eye on 1.3730 support in GBP/USD and 151.32 support in GBP/JPY. Break of these levels would indicate more Sterling weakness to come. Meanwhile, we'd continue to pay attention 1804.70 support in Gold. Break there could sign a more sustainable rebound in the greenback.

In Europe, at the time of writing, FTSE is down -0.20%. DAX is down -0.11%. CAC is up 0.01%. Germany 10-yaer yield is up 0.0425 at -0.322. Earlier in Asia, Nikkei rose 0.86%. Hong Kong HSI rose 0.73%. China Shanghai SSE rose 1.51%. Singapore Strait Times rose 0.24%. Japan 10-year JGB yield dropped -0.0041 to 0.041.

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EUR/GBP Mid-Day Outlook

Daily Pivots: (S1) 0.8568; (P) 0.8577; (R1) 0.8587; More...

EUR/GBP's break of 0.8601 resistance suggest resumption of rise from 0.8448. Intraday bias is back on the upside for 0.8668 resistance first. Firm break there will be a strong sign of near term bullish reversal at least. Next target is 0.8718 resistance. On the downside, break of 0.8561 support, however, would argue that the rebound has completed, and turn bias back to the downside for retesting 0.8448 low.

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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
22:30 AUD AiG Performance of Services Index Aug 45.6 51.7
23:01 GBP BRC Like-For-Like Retail Sales Y/Y Aug 1.50% 3.20% 4.70%
23:30 JPY Labor Cash Earnings Y/Y Jul 1.00% 0.80% 0.10% 0.10%
23:30 JPY Household Spending Y/Y Jul 0.70% 2.90% -5.10%
3:00 CNY Trade Balance (USD) Aug 58.3B 52.3B 56.6B
3:00 CNY Exports (USD) Y/Y Aug 25.60% 17.10% 19.30%
3:00 CNY Imports (USD) Y/Y Aug 33.10% 27.00% 28.10%
3:00 CNY Trade Balance (CNY) Aug 376B 323B 363B
3:00 CNY Exports (CNY) Y/Y Aug 15.70% 22.50% 8.10%
3:00 CNY Imports (CNY) Y/Y Aug 23.10% 9.10% 16.10%
4:30 AUD RBA Rate Decision 0.10% 0.10% 0.10%
5:00 JPY Leading Economic Index Jul P 104.1 103.5 104.1
5:45 CHF Unemployment Rate M/M Aug 2.90% 2.90% 3.00%
6:00 EUR Germany Industrial Production M/M Jul 1.00% 0.70% -1.30% -1.00%
7:00 CHF Foreign Currency Reserves (CHF) Aug 929B 923B 922B
9:00 EUR Eurozone GDP Q/Q Q2 2.20% 2.00% 2.00%
9:00 EUR Eurozone Employment Change Q/Q Q2 F 0.70% 0.50% 0.50%
9:00 EUR Germany ZEW Economic Sentiment Sep 26.5 30.2 40.4
9:00 EUR Germany ZEW Current Situation Sep 31.9 33.1 29.3
9:00 EUR Eurozone ZEW Economic Sentiment Sep 31.1 35.3 42.7