Insights

1 Minute Market Rundown – 14/07/22

Euro/Usd Parity Holds First Time Round and Second!
Earnings Season Continues
US CPI Takes Off
Crypto, Whisper It But Resilient

Yesterday saw huge volatility on the back of US CPI printing 9.1%. The initial move was as I expected in yesterday’s piece with the USD ratcheting higher and stocks/crypto heading lower. Then it all changed as momentum waned and a bout of profit taking saw Eur/usd rally over a cent from the lows, Stocks turn positive from 2% down and crypto base frustratingly just above my zone and rally back to mid recent ranges.

I can’t lie it was painful for this scribe as I saw no reason to walk away from the positions I had and I paid the price. Even more painful is walking into the markets back on their lows this morning with Euro/usd testing parity yet again, Gbp/usd eyeing 1.1800 and Usd/jpy the star performer vaulting 139 and having 140 firmly in its crosshairs.

The outlier is Crypto which sits in the blue and put in place higher lows in BTC and ETH. I am not calling the low yet but it is the first sign that, should the broader risk picture improve, these are the markets to put your money to work as the selling pressures appear to be waning.

The fact stock markets did not extend lower yesterday could also be a sign that the sellers have sold what they need. The market is suddenly pricing in 100 bps this month from the fomc. Let that sink in. The BOC raised 100 yesterday so this is not fanciful talk. The fact risk survived yesterday with that development is either significant or there is a hell of a catch up move coming.

For now I continue to expect euro/usd to break parity soon and in the absence of actual good news expect the recent Crypto and stock market ranges to hold.

A quieter day in prospect for me as I watch from the sidelines.

Good luck all!

Richard Usher – Head of OTC Trading

Richard-Usher

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