Session Wraps - Major Forex Headlines wrapped up by trading session

Author: Greg Michalowski

Forex news for NY trading on December 15, 2017

A snapshot of markets near the end of the week are showing:

  • Spot gold of $2.80 or 0.22% at $1255.73
  • WTI crude oil futures up $.30 or 0.53% at $57.34
  • US yields are mixed with the yield curve continuing to flatten: 2-year 1.8358%, +2.4 basis points.  5-year 2.1504%, +1.2 basis points. 10 year 2.3494%, unchanged. 30 year 2.685%, -2.1 basis points
  • US stocks advanced.  S&P index +0.9%.  NASDAQ composite index +1.17%. Dow industrial average +0.58%
The votes for the tax reform package are starting to line up.  Marco Rubio received concessions on the Child Tax Credit and Bob Corker, who opposed the Republicans tax plan last week, said that he still had reservations but did not want to let a "once in a generation" opportunity pass by (click here).


Those "Yes" votes, helped to send an already up stock market, to even new highs. The major indices ended the day with solid gains led by the Nasdaq up at up 1.17%. That gain pushed the Nasdaq to the head of the table for the week with a 1.41% gain.  The other major indices were also higher for the week, with the Dow up 1.33% and the S&P up 0.92%.  The strong stocks also helped the USD move higher today. 


Looking at the % changes of the major currencies vs. each other, the USD was up against all currencies with the exception of the NZD.  The largest gains for the dollar came against the GBP which fell on Brexit concerns (the GBP was the weakest currency today), and the CAD.  Manufacturing sales in Canada disappointed earlier in the day (-0.4% vs estimate of 1.0% gain). 


In other news today, 

  • The Empire manufacturing index for December came in at 18.0 versus 18.7.  However it still remains near higher levels
  • US industrial production came in a little less than expectations at 0.2% vs 0.3% but the prior month was revised up to 1.2% from 0.9%.  Capacity utilization rose to 77.1% from 77%, but was a touch lower than expectations of 77.2%.
  • Oil rigs were lower by 4 in the current week (747 vs 751 last week). Total rigs were only down 1 (gas rigs were up 3)
  • The CFTC commitment of traders showed that the EUR longs increased to the largest long position since 2007.  
Technically, 

  • The EURUSD fell back below the 100 hour MA and an upward sloping trend at 1.1779 area and stayed below. It is closing at lows for the day at 1.1750.  In trading on Monday, the pair may retest the 1.1712-24 area. That was home to swing high and low levels going back to September 27th.  It held support on Tuesday.On the topside, the 100 hour MA (at 1.1779) is resistance
  • The USDJPY rallied up to the underside of a broken trend line at 112.72 and stalled (see chart below).  That will be a level - followed by the 100 and 200 hour MAs at 112.88-94 - are levels to get above for the buyers/bullls in the new week.  Stay below those levels and the Friday buyers may look to turn the beat around (to the downside) 

  • The GBPUSD was the weakest currency today but stalled at the 1.3300 level. That was the low from earlier in the week too. The pair is closing not far from that level at 1.3323.  A move below the 1.3300 level and the 50% of the move up from the November low at 1.32938, will be more bearish. 
  • The USDCAD moved sharply higher today and tested the week's highs at 1.28916. Sellers came in and pushed the pair off the peak to 1.2865 at the close.  A move above the double top, will be more bullish next week. On the downside, there is a bunch of MAs to get back below including the 100 hour MA at 1.2831 and the 200 hour MA at 1.2815.  Manufacturing sales were not good today. That, and the USD strength, sent the USDCAD back to the upside today..  

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Author: Justin Low

Forex news from European trading - 15 December 2017

Economic data:

Central banks/Brexit:

Others:

Markets:

  • NZD leads the way, GBP the laggard
  • European equities down on the day, follows that in Asia
  • Gold is up by 0.42% to $1,258.03
  • WTI crude is higher on the day by 0.60% to $57.38
  • US 10-year yields up by 1bps to 2.35%

It was a quiet day in terms of the calendar, but there is plenty of action to be had all around. The dollar was the prime mover early on after tax bill worries started to weigh in and we saw the greenback fall across the board - and the moves are still holding (more or less) on most major pairs.

The biggest gainer on the day is the NZD after some short covering in the kiwi in AUD/NZD sent the currency higher so far today. But NZD/USD remains capped by the 0.7030 resistance that I pointed out here.

Meanwhile, CAD continued to maintain its form from yesterday's comments by BOC head Poloz which were a tad bit hawkish. EUR, JPY, CHF, AUD all gained against the USD but are relatively muted - with EUR/USD and USD/JPY having large option expiries that may be interfering with the price action for the time being.

GBP is the biggest loser on the day after sliding in the late morning, and cable has slipped below 1.3400 now. Good all round action despite the lack of data/news, which means we as traders should follow the theme rather than try and buck the trend on days like this.

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Author: Eamonn Sheridan

Forex news for Asia trading Friday 15 December 2017

The fall in the EUR/USD was retraced just a little during the session here in Asia today. The initial move early was down to a fresh low (this was in the early Tokyo morning) to circa 1.1765 followed by a slow grind to around 1.1790 before a sideways shuffle in a tiny range as i update.

There was little in the way of fresh news for the EUR here today.

USD/JPY traded from highs around 112.40-odd towards 112.10. The BOJ Q4 Tankan showed decent results (an 11 year high in large manufacturers sentiment for example) ... more in the posts above.

The results have to raise the issue of why the BOJ continues to be so pedal to the metal on easing, but the answer (so far) is they are way off their inflation target os they keep on keeping on. As I said earlier, something's gotta give. Dunno what that might be though.

After the fall for the USD/JPY it had a sharp spike, here's the pic:


And the story:

Other currencies - it was a slowish sort of day but NZD/USD has managed to perfom OK, up 30+ points from its earlier low. The NZ fin min was reported as saying he was happy with the level of the NZD. Those looking for further falls will be disappointed the rhetoric from the new government is not more bearish.

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Author: Greg Michalowski
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Forex news for NY trader son December 14, 2017

In other markets near the NY close:

  • Spot gold is trading down $3.01 or  -0.24% at $1252.58
  • WTI crude oil futures are trading up $.58 or +1.02% and $57.17.  Brent crude is up $1.05 or 1.70% at $63.50
  • US yield curve continued to flatten.  Two-year 1.813%, +3.8 basis points.  10 year 2.351%, +0.8 basis points.  30 year 2.7078%, -1.9 basis points
  • US stocks are ending the session lower.  S&P index -0.41%.  NASDAQ composite index -0.28%.  Dow industrial average -0.31%
  • bitcoin is trading at $16,375, down $387 more -2.35%
The ECB and BOE both kept rates unchanged today.  The ECB Draghi speaking, so there was a lot to digest by the market.  Key take away's from the ECB Draghi:
  • Rates were unchanged and likely to remain that way for an extended period time
  • QE will continue at €30 billion per month until September 2018 (and perhaps longer).
  • Inflation projections:  2017 is expected to come in at 1.5%.  2018 was pushed up to 1.4% from 1.2%.  2019 remains unchanged at 1.5% from prior estimate.  2020 inflation is expected to come in at 1.7% which is still below the 2% target for the ECB.  Needless to say, if so, the ECB may stay where they are for quite a long period of time
  • GDP growth is seen at 2.4% in 2017 versus 2.2% prior.  2018 growth was increased to 2.3% from 1.8% prior.  2019 growth is seen at 1.9% versus 1.7%.  2020 growth is seen at 1.7%.  So growth is okay especially in the short term but the ECB is not very positive about the momentum continuing long-term
  • They did say that the economy has been improved significantly but wages are reacting way, way slower than in the past
The comments certainly did not scare the market into thinking that the ECB would start to taper further.  That coupled with some pretty decent data at a US in the form of retail sales and initial jobless claims, help to weaken the EURUSD.  PS the US data led to a rise in the Atlanta Fed GDPNow estimate for fourth-quarter growth to the revised to 3.3% from 2.9% previously.  

As far a price action in the EURUSD, the price decline moved back below its 100 day MA at the 1.1800 level and toward a test of the 100 hour MA at 1.17787. A NY afternoon correction on the back of some concerns about the US tax reform passage, took the price back to the 100 day MA (high reached 1.1799), where sellers stalled the move (good stall point). The pair is going out with the price moving below the 100 hour MA at 1.1778.  For the new trading day, STAY below the 100 day MA keeps the bears in control (stop for shorts).  On the downside remember the 1.1712-24 area.

The USDJPY was not as supportive for the USD today. It was more concerned about how the yield curve continues to flatten in the US and the implications of that.   The 2 year yield rose 3.67 basis points, while the 10 year rose by only 0.7 bp. . That puts the spread at 54 basis points.   You have to got to November 2007 to get that narrow.

The USDJPY fell through a trend line at 112.55 and then the 50% of the move up from the November 27th low at 112.29, on it's way to a low at 112.08. The pair did rebound into the close and trades at 112.34, but the market will continue to keep an eye on the interest rate market.  

The Mexican central bank tightened in the NY afternoon and it did help to strengthen the MXN, but only temporarily. The price fell below the 100 hour MA at 19.0627 on the way to a low of 18.977, but the snap back rally, moved back above the MA line and sellers of the pair gave up.  The USDMXN is ending the session at day highs (at 19.15207).  

The AUDUSD did all the rallying after the stunning employment report early in the session. The pair got "sort of" close to the key 200 day MA at 0.7691 (the high reached 0.7679), but really did not threaten a break.  If a 61.6K job gain is not going to send the AUDUSD back above the 200 day MA, it makes you wonder if you are better off selling?  Longs are likely not scared out just yet, but if there is a test of the 200 day MA, and it does not go above, look for the longs to give up and sell.

Below is a snapshot of the strongest and weakest today.  The AUD was the strongest, while the NZD and the EUR were the weakest. The USD was all mixed up with gains vs the EUR, CHF and NZD and declines vs.t eh AUD, JPY, CAD and GBP.  

 

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More session wraps for your convenience.