Forex news for NY trading on January 31, 2018.
- Stocks end the session with gains but well off the highs.
- Apple co-founder Wozniak has sold all his Bitcoin
- Canada's Freeland: I'm cautiously optimistic on NAFTA talks
- FBI memo could set the stage for firing of Mueller or Rosenstein - report
- Bill Gross: Expect the US dollar to stay weak
- AUD/USD slips to six-day low after the Fed. Vulnerable to more selling
- US crude oil settles at $64.73 on the day
- 10 year yield tops 2.75% for the first time since April 2014
- Alan Greenspan says there are two bubbles: A stock market bubble and a bond market bubble
- Dollar moves up and down and all around after FOMC decision
- The full text of the January 2018 FOMC statement
- FOMC decision: Fed funds rate left unchanged in 1.25%-1.50%
- What's priced in for the Fed for the rest of the year
- USDJPY goes into FOMC decision between MA levels
- So long Janet: Our 10 best Yellen photoshop images
- The levels to eye in the EURUSD through the FOMC and why...
- It is deja vu all over again for the AUDUSD
- ECB's Coeure: FX volatility could lead to unwarranted tightening
- Jitters about a hawkish Fed decision are fueling a US dollar climb
- The tax man is coming for South Korean crypto traders
- Can traders learn from "The Process" of the most successful college football ever?
- US oil output hit 10 million barrels per day in November
- European stocks end the day with mixed results
- US weekly crude oil inventories +6776K vs +900K expected
- Bitcoin technicals: Price bias to the downside in the cryptocurrency
- US December pending home sales +0.5% vs +0.5% expected
- January Chicago PMI 65.7 vs 64.0 expected
- Mnuchin: Not concerned about inflation
- Large option expiries still casting a shadow as the clock ticks down
- Treasury refunding: Bigger auctions for 3s, 10s and 30s
- US Q4 employment cost index 0.6% vs 0.6% exp
- Canada November GDP +0.4% vs +0.4% m/m expected
- US January ADP employment 234K vs 185K expected
- The NZD is the strongest. The JPY is the weakest as NA traders enter for the day
A snapshot of other markets near the NY end of day is showing:
- Spot gold up $7.32 or +0.55% at $1345.90
- WTI crude oil futures and $.40 or 0.64% at 6491
- Bitcoin on Bitstamp is trading at $10,034 down -$185. The price traded as low as $9515 and as high as $10,324 today.
- US treasury yields are ending mixed and off high levels. Two-year 2.148%, up 2.4 basis points. five-year 2.527%, up 2.2 basis points. 10 year 2.722%, unchanged (the high reached 2.7519%). Thirty-year 2.947%, -2.3 basis points (its high reached 2.9821%).
- US stocks are ending with gains but off high levels
The FOMC statement added that the expectations would "warrant FURTHER gradual increases in the federal funds rate" (adding the word "further"). They also dropped a line saying "inflation will remain below 2% in near term".
Those changes could be a little more hawkish, but 3 tightenings are expected in 2018. To get four is possible but still need to get through one (which is largely expected in March) and two and then see how economic activity is like after that.
As a result, the dollar market has done some ups and downs after the release but is ending the session mixed. The greenback is ending up vs. JPY and AUD, it is down vs the NZD, CHF, CAD and GBP and near unchanged vs the EUR. Compared to the start of the NY session, the dollar rose vs the EUR, JPY, CHF, CAD, AUD and NZD in the NY session. It fell from earlier levels vs. the GBP. So although a little lower overall, it recovered into the close.
Economic news today was not too bad. ADP non farm employment change was a big beat at 234K vs 186K estimate. That should give dollar sellers cause for pause for the US NFP to be released on Friday (estimate about 181K).
The Chicago PMI came in better at 65.7 vs 64.2 estimate. The pending homes sales were as expected at 0.5%. Not bad numbers - especially the employment figures.
Yields on treasuries did move higher with the 10 year reaching 2.7519% at the high (ending around 2.71%). That rise is starting to have a dampening impact on stocks. Stocks gave back gains in the NY afternoon on rate fears.
What are some of the levels in the major currency pairs.
The EURUSD is going out right at the 100 hour MA at 1.24126. When you get up and down around the 100 bar MA, it says the market is not sure what it wants to do. If it falls and goes below the 1.23837 and then the 200 hour MA at 1.23615 (and moving higher), it could/should be more bearish. On the topside, the high today at 1.2474, stalled at the underside of an old trend line. If buyers start to take this pair higher, that trend line will be eyed. (see post here).
The USDJPY is another pair that is debating what to do next. The pair is higher on the day and in the process moved above the 100 hour MA at 108.907, but below the 200 hour MA and 38.2% at 109.51.
The AUDUSD showed some new downside trouble. It fell below the 200 hour MA and a lower trend line. The price is trading at the 200 hour MA at 0.80529 at the end of the day. Can it stay below that MA in the new day? The AIG Manufacturing, building approvals and Import prices are out in the new day. They will have a say. Key test for the AUDUSD.