Forex news for trading on September 28, 2017.
- S&P sets a record close (I think it's the 38th for the year)
- NZDUSD sets a double bottom and working on a double top. Can it break?
- ECB (Greek central bank chief) Stournaras: Further EUR rise could hurt growth
- EUR/USD: What's the trade? - BAML
- US WTI Crude oil futures settle at $51.56
- Mexico central bank leaves rate unchanged at 7%
- US sells $28B 7 year notes at a year of 2.130%. Good auction.
- Crude oil shifts back to the downside
- Fed's Fischer answers questions: Dot plot reflects views of FOMC participants
- Treasury Secretary Mnuchin: Tax plan will pay for itself
- Kansas City Fed Manufacturing index for September 17 vs. 15 estimate
- Fed's George: Appropriate to continue gradual rate hikes
- ECB's Lautenschlaeger: It's a 'big mistake' to leave Basel III unfinished
- RBC is experimenting with blockchain for cross-border payments
- US wholesale inventories for August 1.0% vs 0.4% estimate
- Third reading: US Q2 GDP +3.1% vs +3.0% expected
- US initial jobless claims 272K versus 270K estimate
- US August advance goods trade balance -$62.9B vs -$65.1B expected
- US NEC Director Cohn: We think we'll get above 3% growth
- The EUR is the strongest and the AUD is the weakest as NA traders enter for day
A snapshot of other markets near the end of day close:
- Spot gold $1287.47, Up +$4.63 or+0.36%
- WTI crude oil is Trading at $51.58, that is down - $.56 or -1.07%
- US stocks ended higher. S&P index +0.12%. The NASDAQ composite index unchanged, Dow industrial average +0.18%
- US treasury yields are ending mixed. 2-year yields 1.4508%, -2 basis points. 5-year yield 1.948%, -1 basis point. 10 year yield 2.3085%, unchanged. 30 year yield 2.8680%, +0.5 basis points.
The snapshot at the and of the trading day is showing that the US dollar is the weakest currency of the major currencies (see chart below). It is lower against all the major pairs with the largest decline coming against the NZD. (-0.51%). The dollar fell -0.42% vs the JPY, -0.37% vs the GBP and -0.32% vs the EUR.
It is hard to put a finger on any one catalyst for the decline.
US 2Q GDP came in better at +3.1% vs 3.0% estimate but then again, we are a few days away from the end of the 2Q. So who really cares (except Pres Trump and his economic advisers as they stump for the tax reform framework released yesterday).
Wholesale inventories were higher than expected. That could be negative in the longer term.
In continued to show a near 63b trade deficit. Needless to say Commerce Secretary Ross (and Trump) are looking to reverse the trend.
Perhaps the strong 7 year note auction and subsequent move lower yields was a catalyst too, especially vs the USDJPY (it is sensitive to rates)
Although lower, on a relative basis the move to the downside for the greenback was modest.
Some levels to watch in the new trading day:
- EURUSD. The EURUSD bounced for the 2nd day in a row of the key 1.1711-20 area. The high peaked near 1.1800. A move above that level, looks toward a key ceiling at 1.1822-275. A move above that would not be welcomed by shorts/bears. The 100 hour MA is at 1.18129. That too will be eyed on a test in the new trading day
- USDJPY. THe price of the USDJPY is dipping below its 100 hour MA in the last few minutes of trading (at 112.319). The 200 hour MA at 112.09 and the 100 day MA at 111.99 are other key support targets. On the topside, the pair failed on a break above the 112.815-112.93 both yesterday and today (see post here).
- GBPUSD. The GBPUSD spent most of the NY trading session moving up to it is 100 hour MA, and back off. There were 3 tests of the MA and each time the price came down about 20 or pips. The 100 hour MA comes in at 1.3446 currently. Staying below keeps the lid on the pair. A move above and there should be more momentum buying.
- The USDCAD moved to the highest level since August 31, but sold off in the NA session. The pair is approaching the 200 bar MA on the 4-hour chart and swing high levels from Tuesday and Wednesday at 1.2402-12. That is a level I would expect to see buyers if they want to keep control.
- NZDUSD. The NZDUSD stalled at the Tuesday low at 0.7166. Double bottom. The rally stalled at the Wednesday high at 0.7238. Double top. Traders can wait for a break and go for it.
To the Asian traders, wishing you a great weekend.