Session Wraps - Major Forex Headlines wrapped up by trading session

Author:

Author: Adam Button

Forex news for New York trading on January 20, 2017:

Draghi:

Data:

Markets:

  • Gold down $2 to $1205
  • WTI crude up 30-cents to $51.38
  • S&P 500 down 9 points to 2263
  • US 10-year yields up 3.5bps to 2.46%
  • NZD leads, CAD lags

There were a few chapters in a back-and-forth trading day that wraps up with the US dollar in the middle of the pack. It was near the top until the final few hours of trading when it began to slide.

The early focus was on the euro and Draghi squared off with the German faction that's beginning to fret about inflation. He repeatedly said inflation a temporary energy bump and that underlying factors are still subdued. That helped to pull the euro down to 1.0589 from 1.0660.

However in the latter half of the day the euro clawed all the way back. There was no headline driving USD sales but there is a sense that longs might want to square up ahead of Trump's inauguration on Friday night.

Stephen Mnuchin put on a solid performance and didn't sound overly partisan or determined to pick fights in Washington. He said it was important that the US dollar was strong in the long term and that he wouldn't comment on short-term moves. On China, he said he would name it a currency manipulator if they 'do it again'.

USD/JPY was also driven by bonds as they sold off early but recovered later, in part due to a strong TIPS auction. The pair rallied as high as 115.62 before slipping to 114.84 late.

Cable finished near the highs of the day, up 70 pips to 1.2332. There is some minor resistance up to 1.2350 but overall it was a strong day for the pound.

USD/CAD continued higher after the BOC fall on Wednesday and is slated to close just above 1.33 after touching 1.3353. The gains come despite a small rise in oil prices.

The Australian dollar was unfazed by the jobs report and shook off a few efforts to push it lower. The worst level of US trading was shortly after London left at 0.7529 but it grinded up to 0.7562 later.

View More

View Full Article with Comments

Author: Mike Paterson

Forex news and trading headlines 19 Jan 2016

News:

Davos:

Other:

Data:

After yesterday's US$ rally post Yellen/Poloz we've seen some come off the table in this session and a few sellers return.

USDJPY had an early look at 115.00 but failed twice around 114.95 and bid a relatively speedy retreat to 114.40 before finding fresh buyers.

GBPUSD led the charge for US$ bears and was soon taking out 1.2300 having held 1.2250 in Asia and helped by some GBPJPY demand. Highs of 1.2342 before running into sellers and that move sent EURGBP down to test 0.8630 from 0.8680.

EURUSD has nudged higher to 1.0671 but once again been caught in some cross play impact and that's mostly had a capping effect.

Oil had an early rally but that too ran out of puff and the retreat has helped USDCAD up to test 1.3300 having found a big line in the sand now at 1.3250. AUDUSD has enjoyed some support from the US$ supply and posted 2-month highs of 0.7574 but tempered by softer gold price while NZDUSD failed to hold above 0.7200  from 0.7133 and fell back to 0.7170

Equities opened a tad softer and done little since

US jobs and housing data to come but it's the ECB presser that will focus attention at 13.30 GMT.

View More

View Full Article with Comments

Author: Eamonn Sheridan

Forex news for Asia trading Thursday 19 January 2017

A fairly subdued session for the FX markets in Asia today following the surge in the USD overnight. The imminent ECB meeting (Europe time, preview here: ECB meets Thursday - what to expect (preview)) looks to be weighing on activity.

USD/JPY edged toward 114.90 and then slipped back a little, down to around 114.50 where it is as I update. There was little in the way of news or data from Japan today.

EUR/USD and USD/CHF extended their US moves slightly also but have both retraced a tiny amount. Cable ditto, but  a bigger range, up from lows circa 1.2250 to around 1.2290.

The Australian (December) employment report was the data focus here today. It was a headline beat but otherwise a lacklustre report. The data and my take on it:

More:

The Australian dollar extended a little lower during the session with a bit of a sharper dip on the report release. Its retraced somewhat now though. NZD/USD followed a similar sort of pattern within a slightly smaller points range.

Gold dropped down toward 1197.50 before bouncing back above 1200.

China:

Another big injection of cash into money markets today from the People's Bank of China (following three big days already this week):

The PBOC injected:

  • 100 bn yuan via 7-day reverse repos
  • 150 bn yuan via 28-day reverse repos
The net injection (after 60bn yuan in maturing loans today) was 190bn yuan
  • Brings the total for the week so far to 1.035tln yuan (biggest since 2008)

Cash demand is surging:

  • Ahead of the Lunar New Year holidays (there are much larger than normal cash withdrawals for gifts, parties and travel over the holiday, January 27 through February  2.
  • Also due this month are corporate tax payments

(ps. The PBOC is also said to be gauging demand for MLF loans. No further word on this yet but you can bet Mike will have the details if the Bank splash some cash here).

Join me tomorrow for the Q4 China GDP report.

Regional equities:

  • Nikkei +0.99%  
  • Shanghai -0.06%
  • HK -0.59%
  • ASX +0.11%

Still to come:

View More

View Full Article with Comments

Author: Greg Michalowski

Forex trading news for NY on January 18, 2017

In other markets:

  • US stocks were mixed: S&P index rose by 0.18%. Nasdaq increased by 0.31%. Dow was down -0.11%
  • US bond yields were higher and that helped propel the dollar.  2 year yield up 6.4 bp to 1.217%. 10 year up 10.2 bp to 2.427%. 30 year bond yield moves back above the 3% level to 3.01% up 8 bp
  • Spot gold fell -$13.00 or 1.06%
  • Silver was down -0.82%
  • Crude oil futures were down -2.1%
The CAD got hit in trading today as the Gov. of the BOC Poloz kept the door open for a further rate cut if downside risks materialize.   One concern is US trade policy under the new President elect Trump.  The expectations are that the NAFTA treaty will be one of the first things of focus once the new President takes office.  The combination sent the CAD lower. It, along with the JPY were the dog currencies of the trading day. 

If the focus was on selling the CAD (and JPY), there was also a focus on buying the USD.  

In the US, CPI came in about as expected at +0.3%, but the headline YoY moved to 2.1% from 1.7%.  Also real average hourly earnings rising by a healthy 0.8%. Later in the day, the Fed's Beige book spoke how employment was getting tighter and although wages were under control, there were shortages of skilled workers.   

US Industrial production increased by a greater than expected +0.8% (vs 0.6% estimate) and that too was good news for the dollar. 

The final kick for the greenback came when Fed chair Yellen spoke more confidently about the path of rate hikes.  The news was not necessarily a huge surprise - and she did also lament the productivity headwinds that she expects to continue to see going forward - but she was confident that rates would move steadily higher into 2019 when they would reach a more normal level. Now nothing is guaranteed but 10 year yields increased back above 3% (up over 10 basis points and the  dollar found a bid.  IN fact the greenback is closing the session near its highest levels against each of the major currencies. 

So what has the changes done to the technicals for some of the major currency pairs?

USDCAD. A big mover on the day was the USDCAD - rising by 1.67%.  BOC Gov. Poloz was bit more dovish on economic concerns. While Yellen outlined a path toward more neutral rates. The combination made for a trending market to the upside.  Technically, the USDCAD first pushed above the 100 hour MA at 1.3123 (the first test held), and then the 200 hour MA at 1.31648. The move above that MA was the first breach since December 30th.  After the Yellen comments, the price was kicked even higher,with the pair adding another 100 pips above the 200 hour MA. At the close, the pair is pushing right against the 100 day MA at 1.3269. That SHOULD stall the rise for now.  However, iIt was just yesterday that the USDCAD was breaking and closing below the 200 day MA. 24-hours later, the pair has reversed 250 pips higher. If there is a correction in the start of the new trading day, I would think that 1.3208 to 1.3220 should attract buyers.

EURUSD. The EURUSD was confined to a fairly narrow trading range for the day of 59 pips for most of the NY session.  The pair was moving up and down. However, the highs in both the London morning session and the NY session stalled just below the 1.0706 level. HMMM.   That level corresponded with the 38.2% of the move down from the Election Day high.  We needed to break and stay above that retracement level in order to make a run higher (see video from the weekend by clicking here). We traded above that level (to 1.0718) both yesterday and at the beginning of trading today, but each of the moves above the 1.0706 level, ended up stalling below the prior highs.  Moreover, the last two highs (in London morning session and the NY session high) came up short of the 1.0706. level  Anyway, the Yellen kick to the downside (dollar higher) extended the range to a more respectable 88 pips for the day, and also took the price below the 100 hour MA  at 1.06443 currently (that is now resistance into the new day).  The tide has turned a bit more bearish in the EURUSD. PS the close from Friday was 1.0638. We are now trading at 1.0630. So we are now negative on the week.  PSS.  The 200 hour MA at 1.0607 will be the next key test (watch 1.0617 too). A move below those levels and we could see more momentum selling. 

USDJPY. The USDJPY - like the EURUSD - slow played the bullish USD cards. The low for the day was in the early Asian session. The range was a respectable 100 pips into the NY session, but the price rise stalled near the low from Monday at 113.61.  Yellen comes along and the pair goes another 120 pips higher. In the new trading day, the price has a key overhead target at the 200 hour MA and 38.2% retracement of the move down from the Jan high. That comes in at 114.87.  Get above and the 115.20 becomes the next target.  I look for support to hold at 114.15-30 now.  

AUDUSD: In Australia the jobs report will be released. Technically, the pair moved lower (higher USD) in the NY session BUT the price fall stalled near the 100 hour MA, the 100 day MA and the 200 day MA which all come in between 0.7500 and 0.7507. The price closed the day just above that level (the low for the day reached 0.7501).  It seems like the market will be making a bullish or bearish move away from that area dependent on the jobs report. KEY. KEY. KEY area.

Finally, the NZDUSD moved above the 100 day MA and closed above that MA yesterday at the 0.7147 level. Today (after peaking at 0.72187) the price moved back below 100 day MA.  So much for that break. The 100 day MA is now a topside resistance level again.  

Below is a snapshot of the percentage changes of the major currencies vs each other near the end of the trading day.




View More

View Full Article with Comments

More session wraps for your convenience.

;