Sterling Softens as Traders Await Brexit Clarity, Aussie Lost Momentum after Initial Rally
Action Insight Mid-Day Report 3-18-19

Sterling Softens as Traders Await Brexit Clarity, Aussie Lost Momentum after Initial Rally

Sterling is trading as the weakest one for today so far after suffering some selling in European session. No support is seen for the Pound even though high profile Brexiteer Jacob Rees-Mogg indicated that he might support Prime Minister Theresa May's Brexit deal. However, loss is limited in Sterling as the overall picture remains unclear. For now, it's uncertain whether the government will pull tomorrow's Brexit meaningful vote due to far insufficient support.

Staying in the currency markets, Australian Dollar was lifted earlier today by strong rally in Chinese stocks. But it lost some momentum after European markets turned mixed. Also, the Aussie will facing tests from RBA minutes as well as house price data in the upcoming session. Euro picked up some strengthen even though Bundesbank warned of subdued German growth in Q1. Rise in German yield is unpinning Euro for now. Overall, the markets lack clear direction in early US session.

In Europe, FTSE is up 0.64%. DAX is down -0.30%. CAC is flat. German 10-year yield is up 0.0094 at 0.095, getting close to 0.1 handle. Earlier in Asia, Nikkei rose 0.62%. Hong Kong HSI rose 1.37%. China Shanghai SSE rose 2.47%. Singapore Strait Times rose 0.40%. Japan 10-year JGB yield rose 0.002 to -0.035.

On the data front, Canada international securities transactions rose CAD 28.4B in January. Eurozone trade surplus widened to EUR 17.0B in January, missed expectation of EUR 17.2B. UK Rightmove house price rose 0.4% mom in March. Japan industrial production was finalized at -3.4% mom in January, trade surplus widened slightly to JPY 0.12T in February.

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GBP/USD Mid-Day Outlook

Daily Pivots: (S1) 1.3231; (P) 1.3265; (R1) 1.3328; More....

GBP/USD is staying in consolidation below 1.3381 temporary top and intraday bias remains neutral. Further rise is expected as long as 1.2960 support holds. On the upside, firm break of 1.3381 will target 61.8% retracement of 1.4376 to 1.2391 at 1.3618 next. However, on the downside, firm break of 1.2960 will indicate that rebound from 1.2391 has completed earlier than expected. Deeper fall would then be seen to 1.2773 support for confirmation.

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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
23:50 JPY Trade Balance (JPY) Feb 0.12T 0.09T -0.37T -0.29T
00:01 GBP Rightmove House Prices M/M Mar 0.40% 0.70%
04:30 JPY Industrial Production M/M Jan F -3.40% -3.70% -3.70%
10:00 EUR Eurozone Trade Balance (EUR) Jan 17.0B 17.2B 15.6B 16.0B
12:30 CAD International Securities Transactions (CAD) Jan 28.40B 15.03B -18.96B
14:00 USD NAHB Housing Market Index Mar 63 62
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