Forex trading news and economic data headlines August 4, 2015

  • Greece looking to have a bailout deal done by 18th August
  • Want to know the market's verdict on the RBA?
  • July 2015 Canada RBC manufacturing PMI 50.8 vs 51.3 prior
  • July 2015 US ISM New York 68.8 vs 63.1 prior
  • A day after breaking below the 200 day MA, Apple remains pressured
  • June 2015 US factory orders +1.8% vs +1.8% exp m/m
  • IBD/TIPP Economic Optimism index for August 46.9 vs. 47.8 exp.
  • New Zealand Fonterra dairy prices -9.3% vs -10.7% prior
  • Forex technical analysis: GBPUSD falls below 200 hour MA and 50%..again
  • Low liquidity throwing the prices around while US bonds continue to jockey over the Fed
  • Spain and Italy lead the losers at the European close
  • Dealing with summer markets
  • Feds Lockhart. September could be appropriate for liftoff
  • Forex technical analysis: EURUSD hit an air pocket and breaks to new day lows
  • Forex technical analysis: USDCAD, USDJPY, USDCHF, NZDUSD make new day extremes
  • US stocks end down on the day

It looked like a repeat of yesterday's trading. Ranges for most pairs (sans the AUDUSD) were well off their recent averages (i.e. volatility down). There was some choppy action with no discernible trend. Factory Orders came in close to expectations. IBD/TIPP Economic optimism was weaker. The market stayed in a range.

Then at the London 4 PM fixing, the market got goosed by action in the GBP pairs. Was it EURGBP, GBPJPY, GBPUSD or a combination of all? Suddenly all three showed GBP weakness. That was shortly followed by a rally the other way in the currency (there was no real news catalyst). The first lap was completed (i.e. a complete retracement higher of the move down in the GBP).

By the end of the day, there was another lap back down in the GBPUSD at least. This was caused by comments in a Wall Street Journal article that had Atlanta Fed's Lockhart saying it would take a "significant deterioration" in the data to cause him to delay a rate rise. That is one vote for the tightening. Lockhart is a hawk, but combined with the hawkish comments on Friday from Feds Bullard, seems to suggest it might be tightening in September or bust for the Fed. At least the market took it that way today with an illiquid market to help the momentum. By the end, the dollar rose against all the major currency pairs with the exception of the AUD which had it's own central bank to blame for it's strength.

As for specific pairs, the EURUSD fell below support at the 1.0921 level and ended the day near the lows at 1.0878. The pair traded at the lowest level since July 22.

The GBPUSD won the prize for the most up and down volatile currency for the day. It initially fell to support at 1.5560, rose to 1.5627, fell back to 1.5560, rose to 1.5604 and ended back down at 1.5560, As far as ranges goes that was only about 70 pips, but it was an up and down 70 pip roller coaster ride for most of the NY session. In the new day, a break below 1.5550 or above 1.5650. should be a catalyst for the next move, but be aware for continued up and down activity.

The USDJPY made a break for the upside again. It followed the lead from the Lacker comments and also broke out of a pennant formation to the upside.

USDCAD also rallied, but it was not on the back of weaker oil prices for a change. Oil prices ended higher on the day after days of weakness.

The AUDUSD made new session highs in the NY morning session after the RBA changed the wording in the statement choosing not to talk down the AUD. The change in tone sent the AUDUSD sharply higher but by the end of the day had started to wander lower on the back of the strength in the USD.

Summer markets. Volatile markets. Choppy markets. Be aware. Be prepared. They can chew you to pieces if you are not careful.