Forex news for NY trading on April 16, 2020.
- CDC reports a jump of new deaths to 27,012 versus 24,582 yesterday
- Feds Harker on CNBC: Never faced a situation like this before
- Fed's Bullard: Expects lockdown to have a severe economic impact
- Pres. Trump says trying for 2 trillion infrastructure package
- Ohio is planning to restart the economy on May 1
- WTI crude oil futures settle at $19.87
- Fed's Barkin: Reopening of economy cannot wait for his 0 infection rate
- Fed's Williams: US economy under distress from coronavirus
- France confirmed cases rises to 108,847 from 106,206 yesterday
- New Jersey (the 2nd most impacted state) new cases rise to 75,317 from 70,926 yesterday
- Fed's Kaplan: Sees peak unemployment in mid to high teens
- White House: G7 leaders agree to remain committed to global response to coronavirus
- Italy virus deaths 525 versus 578 yesterday
- ECB allows lower capital requirements for market risk
- New York coronavirus deaths 606 versus 752 yesterday
- European shares close with mostly modest gains
- US 5-year yields near the March lows
- US small business grant program runs out of money
- Facebook revamps libra, plans multiple single-currency coins
- Switzerland outlines plans to slowly re-open
- OPEC says April oil demand to fall 20 mbpd, Q2 to be -12 mbpd. Risks to the downside
- US housing starts for March 1216K vs 1300K estimate
- US April Philly Fed -56.6 vs -32.0 expected
- Canada March ADP employment -177.3K vs +7.2K prior
- Canada February manufacturing sales +0.5% vs +0.1% expected
- US initial jobless claims 5245K vs 5500K estimate
- The CAD is the strongest and the AUD is the weakest as NA traders enter for the day
What's another 5.24M job losses?
The weekly jobless claims once again showed a large amount of new claims for unemployment with in additional 5.24M added to the dole. That brings the total to slightly over 22 million over the last 4 weeks.
Adding to the economic woes, the Philadelphia Fed index tumbled to -56.6 versus -32.0 estimate. That took the index to the lowest level since 1980. US housing starts and building permits also fell sharply, with the decline in housing starts the most since 1984.
Needless to say it was not a good day for the US economic data.
The weaker data helped to initially push US yields lower especially on the longer end of the yield curve lower and in turn, flattened the curve outright. However, by the end of the day, US yields were mixed with the 2 and 5 year yield rebounding higher,but the longer end attracting steady buyers.
The 10 year yield fell by -1.8 basis points with the 30 year falling by a much greater -5.7 basis points. The yield curve flattened with the 2 – 10 year spread narrowing to around 41 basis points from 43.5 basis points at the close yesterday.
Although yields were influenced by the weaker data, US stocks were not really impacted. All 3 indices closed higher with the Dow lagging(Boeing fell by over 7% which the price the Dow average). A look at the final numbers shows the NASDAQ index rose by 1.66% while the Dow industrial average rose by only 0.14%. The S&P index gained 0.58%.
Despite the disparity in the fortunes of the relative indices, each are closing near their highs for the day. European shares were mixed with Germany UK and Italy higher but UK Spain and Portugal lower.
In the forex market, bad news is good news for the US dollar is investors prefers the relative safety of the greenback. The US dollar is closing just below behind the CAD as the strongest of the major currencies. The EUR and NZD were the weakest today.
Taking a look at some of the individual major currency pairs:
- EURUSD: The EURUSD fell below the 38.2% retracement of the move up from the April 6 low at 1.09043 in the Asian session and stay below that level for the rest the day. The pair also spent most of the session below its 200 hour moving average at 1.0885. It will take a move above that moving average line to tilt the bias more to the upside in the new trading day. On the downside, the pair is trading in the bottom quadrant of the range since April 6 with swing lows at 1.0829, and .0820 and then the April 6 low 1.07677 as downside targets
- GBPUSD: The GBPUSD fell below its 200 hour moving average for the 1st time since April 8 but could not extend below the 50% retracement at 1.24042 (buyers leaned against the moving average level at 1.24074) and pushed the price higher. The pair is closing the day right near its 200 hour moving average at 1.24466. That moving average will be the barometer for the bulls and bears going into the last day of the trading week. Move below and the bears are in control. Move above and the bulls are more in control
- USDJPY: The USDJPY had an up and down and back up again day. Selllers in the NY session reversed the pair from a high of 108.07 all the way down to a new day low at 107.15. Just when you thought the pair would make a run toward the April lows at 107.00 and 106.91, the price reversed sharply to the upside and is closing up at 107.79. That took the price back above its 100 hour moving average at 107.616. It will take a move below the 100 hour moving average to tilt the bias back to the downside.
- AUDUSD: The AUDUSD stalled the fall in the Asian session right against its 200 hour moving average and 38.2% retracement at the 0.6266 level. In the New York session the rising 200 hour moving average was broken but the same 38.2% retracement held support. The New York session low at only get to 0.6270 before moving higher into the close (and back above 0.6300 level at 0.6304). In the new day it will take a move back below the rising 200 hour moving average at 0.62867 to solicit more selling
Wishing all Asian Pacific traders a happy and healthy weekend. Thank you for your support this weekend and stay safe.
