Wednesday has passed already. And the day was dominated by a strong USD and political events in the UK. Crypto would take a vacation day.

However, the day saw an early decline in crypto across the board as BTC rather suddenly dropped through the $10,000 down to $9,580.

ETH also dropped hitting a low of just under $201. We then squeeze back higher before BTC heads back to $9,600 once more. Interesting, as ETH manages to hold above $210. All in all a subdued day for crypto with little in the way of market moving headlines.

On to FX, and a day dominated by GBPUSD volatility.

The market was happy to bounce around between 1.2426 and 1.2522 as traders digested the implications of Boris Johnson becoming Prime Minister and the timetable for Brexit.

Phillip Hammond resigned as Chancellor of the Exchequer, but this was largely expected and had little effect on the market. In fact, much of the UK cabinet will have a very new look as the new Prime Minister surrounds himself with his people.

Elsewhere AUDUSD broke through key support at 0.7000 and EURUSD traded down to 1.1127, just shy of key support near 1.1110.

US stocks would open lower led by a 150-point drop in the DJ as Boeing and Caterpillar announced far worse results for Q2 than had been expected, which in turn sent USDJPY briefly back to 108.00 before closing nearer 108.20.

However, the S&P and Nasdaq spend much of the day in positive territory and make new record high closes.

Now attention turns to Thursday’s ECB meeting and a potentially a surprise cut in rates. None is expected but the day’s softer than expected Manufacturing PMI could spark a surprise.

EURCHF Tuesday, EURGBP Wednesday. Another cross I probably have mentioned sparingly in my commentary but will give it a little technical love today.

As you can see from this 2H chart, There has been quite the rally since the beginning of May and only just now as the UK Conservative Party leadership battle ends and we focus on the next moves from the ECB has EUR/GBP started to turn.

Get a surprise cut in European interest rates and the downside becomes vulnerable. We are currently sitting just above support at 0.8909 with strong support at 0.8873 not far behind.

Given the speed of the move up, expect the market to be sitting a little long and beware the retracement.

