The debt traders are casting their vote
The that traders are casting their vote as far as rates are concerned. They - for the most part -
shunned the 3, 10 and 30 year auctions this week. The 30 year auction today was the worst with a five point basis point tail above the WI level at the time of the auction.
The horrible auction has sent stocks lower. The NASDAQ index is now down -1.23% at 15689.
The US dollar has also moved higher.
EURUSD:
The EURUSD is trading at a new 2021 low and has also cracked below the 50% midpoint of the move up from the March 2020 low to the January 2021 high. That level comes in at 1.14892. The current price is trading at 1.1487 just below that level. The low reached 1.14811. The shorts are in control with risk now between the swing low from November at 1.15125 and the swing low from September at 1.15236. Stay below those levels and the sellers remain in firm control. Move above and there could be some covering on the failed break.
USDJPY:
The USDJPY is up testing the 114.00 level and in the process is testing the swing high from Friday's trade at 114.023 AND a downward sloping trendline connecting recent highs on the hourly chart (see chart above). The high just reached 114.008.
On the move higher, the price is moving even further away from the 200 hour moving average at 113.653. That moving average is broken early today and stayed broken. Ultimately the price would need to move back below the 200 hour moving average to hurt the bullish bias now. Break the topside trendline and traders will look toward the 114.20 to 114.307 area.
Earlier today, the price moved back into the "Red Box" that confined the range going back to October 12. The move below the level took the price toward the 50% midpoint and 112.754 yesterday and again today, but momentum below that level could not be established. When the price moved back into the "red box" area and above the 100 hour moving average, that started the trend run higher today.
GBPUSD:
The GBPUSD trade down to a new session low at 1.34167. Then has taken the price below the Friday postemployment low reached at 1.34236, but just above the swing lows from September 29 and September 30 between 1.3411 and 1.34149. The current price trade at 1.34234.
A move below the 1.3411 level would have the pair trading at the lowest level since December 23, 2020. A move below opens the door for further downside momentum.
USDCHF:
The USDCHF it is trading to its highest level since October 28, and in the processes moving close to the 100 day moving average target at 0.9187. Just above that level is the 38.2% retracement of the move down from the September 30 high at the 0.91904 level. A swing area comes between 0.91846 and 0.91938. Get above those levels would open the door for further upside momentum in the pair now.
