Quiet range bound week in most markets

This Daily Digest will cover:

• Quiet range bound week in most markets
• USD has strengthened against the majors
• Crypto quiet and consolidating- no bad thing at these levels
• Month end, quarter end and half year end volatility likely

The theme of the week has been mild USD strength in FX with GBP giving the yen a hard time in the race for the worst performer thus far. U.S economic data has continued to run hot with GDP showing a surprise beat yesterday reinforcing expectations for 2 more rate hikes this year. Despite this stocks continue to merrily look bid and I am putting my bear costume in the bottom drawer for another day – against my better judgement. Core PCE data is released today and is worth monitoring as the FED’s favourite inflation gauge.

Crypto has had a week to forget volatility wise but that is no bad thing. BTC holding above 29,500/30,000 after the frantic rally last week is impressive. I am still hoping to see a close above 31,250 so confirm the chart break illustrated on Monday. Performance elsewhere has been more muted with ETH facing a thicket of sellers above 1910 and the Alt’s generally continuing to underperform. This makes sense when the bigger picture positive news is all about BTC at the moment. As a wise man once said to me, if the good news is about Oil, buy Oil, don’t get clever.

To close out the week we have the culmination of the month/quarter and half year end. Expect volatility and some random moves. Equity moves suggest USD selling should be the order of the day but the models have been way off recently so I will be patient.

Good luck as always

Richard Usher
Head of OTC Trading