Forex trading news for April 30, 2015, US edition:
- US initial claims 262K vs. 290K estimate. - 15 year low
- US March core PCE inflation 1.3% y/y vs 1.4% expected
- March 2015 US personal income 0.0% vs 0.2% exp m/m
- Q1 2015 US employment costs 0.7% vs 0.6% exp q/q
- April 2015 US Chicago PMI 52.3 vs 50.0 exp
- Canadian Feb GDP 0.0% vs -0.1% expected
- Latest poll has Labour Party leading UK election by 2 points
- Ireland's ECB Governing Council member Honohan said to plan resignation
- US EIA natural gas storage comes in at 81 BCF vs est. of 82 BCF
- Bernanke has his claws out for the WSJ
- Gold down $21 to $1183
- S&P 500 down 21 to 2085
- WTI crude down $1.12 to $59.71
- EUR leads, AUD lags
The dollar just needed a sniff of good news for the data to rebound. It's a dead giveaway that the bulls were looking for good news because they ignored the inflation data and latched onto initial jobless claims (likely skewed), a minor uptick in wage inflation and (later) a beat in the Chicago PMI.
In something like GBPUSD, which had gained in 12 of 13 days, it doesn't take much for a turnaround. The data and momentum afterwards sent the pair to 1.5304 from 1.5425. In the final hour of trading some dollar selling and month end flows pushed the pair back to 1.5354.
USD/JPY absolutely ripped higher to 119.60 from 118.80 and then all the way to 119.90 before it finally cooled off. Later in the day, stocks began to roll over and the pair slid back to 119.40.
The big exception was the euro as the short squeeze gathers momentum. It blasted 150 pips higher in Europe up to 1.1249 and then almost completely retraced before a second wave of buying hit in US trading and 1.1250 gave way to 1.1266. A bit of late selling down to 1.2222.
USD/CAD turned around after the fall below 1.2000 yesterday. Oil continued higher but it didn't help the loonie as USD/CAD ramped up to 1.2125 in a half-cent move on the data.
Talk of rate cuts weighed heavily on the Australian dollar. An RBA watcher in the Australian press talked about a cut and the momentum clearly reversed after the recent run up. Most of the damage was done in Europe and Asia but it craved out a low of 0.7863 in US trading before a rebound to 0.7905.
Gold was flushed on a break of $1200. It's tough to envision a good catalyst for gold longs right now and that knocked it down to $1178 but there's support at $1175 and that's key now.
