Forex news for US trading June 17, 2015:
Fed/Yellen
- Fed decision: FOMC says labor market slack has 'diminished somewhat', job growth picked up
- Full text of the FOMC decision July 17, 2015
- US FOMC funds rate projections dragged down
- US Fed lowers 2015 GDP forecast to 1.8% - 2.0% vs 2.3% - 2.7% prior
- How the Fed statement changed
- Hilsenrath: Fed signaled it was moving toward rate hikes
- Yellen: Despite soft Q1, fundamentals for household spending positive
- Yellen Q&A: The dots are forecasts but views will evolve with data
- Yellen Q&A: No decision has been made on timing of rate hikes
- Four 'decisive' quotes from Yellen
Everything else:
- Greek parliament committee declares Troika debts illegal and says they can't and should not pay
- BOE's Forbes: Sees CPI moving toward target in early 2016
- BOE's Forbes: "We still do have some time" before rates need to rise
- The writers at the Australian Financial Review are not trying ti swindle 'retail' traders out of a few bucks
- US EIA weekly crude oil inventories -2676K vs -1500K expected
- FedEx sees slower US growth
- EU's Dombrovskis says latest EU proposal has "quite substantial" flexibility
- Gold up $3 to $1185
- S&P 500 up 4 points to 2100
- US 10-year yields up 1 bps to 2.32%
- WTI crude down 20-cents to $$59.72
- GBP leads, AUD lags
The final hours before the Fed featured fast-money traders making bets on a hawkish Fed. Yellen wasn't hawkish at all and they got crushed. The patterns on the charts are reversals, hanging men and spinning tops. Dollar bulls are definitely wounded.
EUR/USD offered a hint of what would come after the Fed. Early US trading saw it slide to 1.1225 but (as always) there were buyers waiting on the dips and it had rebounded to 1.1260 by Fed time. There was the usual whipsaw on the announcement but it moved higher quickly and stayed at 1.1300 until the press conference. When Yellen talked about wanting to see 'decisive' data, it pushed higher again and hit 1.1357.
USD/JPY traders might have been burned the most. It was a one-way trade higher in Europe and the US. It moved to 124.20 from 123.42 but the gains were totally wiped out in a drop to 123.20.
Cable caught a bid in Europe on wage inflation data but was chopping in a 1.5700 to 1.5750 range ahead of the release. It was a greenlight afterwards as the May highs broke in a shot to 1.5847. That's 8 days without cable breaking the previous day's low.
The commodity currencies followed a similar pattern. USD/CAD was slightly higher on the day at 1.2320 ahead of the news and was then slammed a cent lower. The Aussie gained a cent against the US dollar after the day to wipe out the earlier loss.
Oil took a hit after the inventory data. It wasn't particularly bearish but there was a build at Cushing and we were near the top of that range. I can't wait for that range to bust because it's going to be a good move when it does.
