The John Elfed Forex Blog

All eyes on CPI.

Today's PPI data came in slightly above forecast, which only adds credence to the higher for longer narative. I have read a couple of articles suggesting tomorrow's CPI data may be a little softer than forecast, thanks to the decline in the price of oil. Two

Tuesday 10 October. 15:15 UK time.

Opening gap.

As you may know, I always close any open positions on Friday afternoon. The reason being to avoid weekend risk, today was a very good example of why this is a good idea. The outbreak of war in the middle east caused the JPY to open with a gap higher.

Monday 9 October. US. Session.

With the bond market closed for a partial holiday, the FX market is fairly quiet today. There was a mild 'risk off' tone with the JPY gapping higher at the Asian open. But the negativity hasn't materialised into fear and I'll be waiting until

Weekend news

Sad to see that trouble has flared up between Palastine and Israel. With Israel promising retaliation. Horrific scenes after twenty years of relative calm in the region. Market implications: historically, the Israel Palestine conflict hasn't particularly has an effect on the market, but the fallout from Israel'

Weekly review

The week starting Monday 2 October was again, mainly dominated by the strong dollar, high yields story. With a little bit of JPY intervention (?) thrown into the mix. Monday was a fairly quiet day, as it often is in Forex. On Tuesday, I tried to take advantage of USD strength

A few hours is a long time.

They say a week is a long time in politics, today a few hours was a long time in Forex. The initial reaction to today's NFP was dollar strength and a softening risk environment. But once the data had been digested,good news eventually became good news and

Huge NFP beat

This morning, I thought a higher than projected number would provide a dollar long opportunity. We got that, and then some, a huge beat 336k Vs 187 forecast. The dollar has reacted accordingly, yields are up, stocks are under pressure ..good news is bad news today. It's take

NFP day.

As the European session gets underway, the currencies are in wait and see mode before NFP. A concensus reading could re-ignite USD strength maintaining the higher for much longer narative. Elsewhere, Canadian jobs numbers will give an indication if anymore hikes could be needed from the BOC. Next look: 13:

Where did all the catalysts go?

Readers of my book will know that one type of trade I take, I categorise as a 'catalyst'. It is essentially a big move in a currency, caused by a particular event, generally a data release or political statement. Pre COVID-19, it wasn't unusual for there

Wednesday 4 October. 16:30 UK time.

Wednesday 4 October. 07:20 UK time.

Still no change to the narative. USD JPY has steadied following yesterdays (intervention?) I'd still be a little wary of trading the yen at the moment though. Overnight NZD held its rate and slightly disappointed the markets by remaining fairly dovish. For me, the USD is still the

Tuesday 3 October. 19:45 UK time.

Tuesday 3 October 17:30 UK time.

Another day, same old reasons to be dollar positive, with the US 10year touching 4.8%. The possibility of a hike in November has risen slightly. Stocks are down, feeling the pinch of higher rates. Even a mildly hawkish rate hold from Australia couldn't save the AUD. it&

Monday 2 October 16:30 UK time

Monday 2 October. 08:00 UK time.

As the first European session of the 4th quarter gets underway. Dissapointing PMI data from china over the weekend. Japan announced unscheduled bond buying in an attempt to keep the yield on a 10year Japanese bond as low as possible. This may cause nervousness around the possibility of Japanese intervention.

Weekly review

This past week was dominated by the long dollar story. Particularly the early part of the week. The US 10year bond yield rose comfortabley above 4.5%, the S&P remained under pressure, the cause being the higher for longer narative. It's always a little tricky to

Thursday 28 September. 17:50 UK time.

Thursday 28 September. European session.

A bit of dollar weakness in this mornings European session, with the 'risk asset' currencies in positive territory. I can't see any particular news to support the positive mood, it may well be quarter end profit taking. My current position is to wait for the US

Wednesday 27 September 17:30 UK time.

USD strength is unabating, backed up again today by strong data (durable goods) yields are still marching higher, the VIX is above 19 for the first time in a long time. Stocks and gold are on the verge of a technical breakdown. The higher for longer narative is really starting

Tuesday 26 September 20:25 UK time.

Yesterdays GBP USD trade has completed at hit profit. Nothing has changed to alter my view that the USD is the only viable long at the moment. In fact, Target announcing they will close nine stores across the US has put pressure on the S&P and adds credence

Tuesday 26 September. 16:00 UK time.

With yesterdays trade still running, my hands are tied in terms of placing another trade. But the narative remains the same, strong dollar, weak pound (and euro) the commodity currencies are still holding up well (which is interesting in a mildy negative stock environment and does bode well). I still

Monday 25 September 14:15 UK time.

As the US markets start the week. With a light data calendar, the US 10year is above 4.5 on the higher for longer narative, the S&P is under a little pressure (not helped by negative property sector news from china). There is no news to change my

Weekly review

This last week was filled by central bank decisions from the US, Britain and Japan (and also Switzerland). Plus inflation data from the UK and Canada created movement. Monday was a very quiet day, things started to get moving on Tuesday, with producer product data from Canada giving an indication

Friday 22 September 15:00 UK time.