Trade Ideas are short term (mostly intraday) forex strategies realesed daily by UBS analytics. In todays release we can get to know with their ideas for such currency pairs like EUR/USD, GBP/USD and USD/JPY.

GBP/USD

It was a unpleasant surprise. Morning, bank still was recommending buying dips on GBP/USD in favor on more hawkish BoE minutes. That is unfortunately past, because both – voting and minutes turned out more dovish than expected.

Rumors were, that Kristin Forbes would join Iana McCafferty voting for a hike. Result was still 1-8 for keeping current rates, but much more damage was caused by less hawkish (even dovish) Bank of England report. Governors are concerned about inflation and growth expectations, seeing an even flatter path for rates.

That’s why pound plummet after 12:00 GMT, getting through every supply UBS marked. Actualised view from UBS analytics was not published till now.

EUR/USD

Pair also had its macro events. Todays Draghi speech didn’t really add new information to our current view. Surprisingly, investors carried much more about yesterdays Yellen testimony. Chair confirmed once again, that December is still a possibility and the pair tested 1.0850, which has held a few times earlier this year. We prefer playing the short side, even though the pair has come a long way in a short time. We expect to see range-trading ahead of US payrolls tomorrow, with buying interest around 1.0800 and sellers lined up above 1.0900. Support at 1.0840, 1.0810 and 1.0785; resistance at 1.0875, 1.0900 and 1.0935.

USD/JPY

US Treasury yields have continued to head higher following the hawkish remarks from Fed Chairwoman Yellen yesterday. The US dollar has strengthened, but USDJPY has topped out at 122.00, as the market seems to be cautious ahead of US payrolls tomorrow. The pair feels like it will eventually move higher, so dips closer to 121 should be bought.