Published: 2024-08-22T10:10:11.000Z
Psychology for major markets August 22nd
Senior FX Strategist
3
More risk positive tone weighing on USD and JPY short term
EUR/USD – EUR/USD edging higher on the back of generally softer USD, but upside still looks restricted given minimal decline in yield spreads with PMIs still looking subdued.
USD/JPY – Dipped sharply from key resistance area below 150. Underlying sentiment remains bearish as market anticipates further yield spread contraction going forward, but better risk sentiment limits downside for now.
EUR/GBP – Strong UK GDP and PMI data and generally more risk positive tone underpinning GBP. Breaking below 0.85, but GBP valuation looking a little extended.
AUD/USD – AUD remains well bid in more risk positive market, moving into the top end of the year’s range.
Equities – Small gains as correction seen to be overdone, but some large players offloading into rallies.