Forex news for US trading for August 15, 2016
- US stocks start the day lower. End lower.
- Crude oil futures settle up 1.84% to $46.58
- GBPUSD and EURGBP continues push to new extremes
- Citi trade from yesterday...stopped out
- More from Lockhart: Still conceivable for 2 hikes.
- Fed's Lockhart Q&A
- Forex technical analysis: GBPJPY pushes toward 100 hour MA
- Feds Lockhart: At least one Fed rate hike could be warranted this year
- GBPUSD breaks to new session highs as London traders look to exit
- European stocks finish lower
- USDJPY pushing the limits a bit, but remain more bearish
- New Zealand GDT price index 12.7% vs 6.6% prior
- Atlanta Fed GDPNow moves up to 3.6% in new forecast
- RBA Stevens speaks to The Australian
- Don't expect 'material surprises' in Wednesday's FOMC Minutes - RBS
- RBA's Stevens: Stronger GDP growth rates would be welcomed
- Forex technical analysis: GBPUSD trades between 200/100 hour MA
- BOE scoops up offers of £3.12bn vs £1.17bn expected in Gilt operation
- Stocks and bonds choose Dudley over inflation data
- US dollar rebound extends on strong factory data
- July 2016 US industrial production 0.7% vs 0.3% exp m/m
- Forex technical analysis: USDJPY bounces. Dudley to blame (or thank).
- USD/JPY jumps back above 100.00 on September rate hike talk
- Britain could get "special status" in EU relationship but needs to get on with Brexit - Ze Germans
- We are getting closer to the time to hike rates says Fed's Dudley
- US July housing starts 1211K vs 1180K expected
- July 2016 US CPI 0.8% vs 0.9% exp y/y
- Canadian June manufacturing sales +0.8% vs +0.5% expected
- The strongest and weakest currencies as NA traders enter for the day
The dollar was under pressure from the start in the NY session. US CPI came out a touch weaker which sent the dollar lower still. Shortly thereafter, however, Fed's Dudley came out and said that the Fed is getting closer to the time to hike rates. Having those headlines come when the USDJPY is sitting on a precipice below the 100.00 level (the low extended to 99.50), was enough to give the dollar a bit of a boost off the lows. Later in the session, Fed's Lockhart expressed similar comments to Dudley's. By that time the corrections had been completed. Overall, the NY session saw a bit of a recovery in what was a dollar lower day.
The "recovery" part only applies to some of the USD pairs. One pair that did not give up the USD selling was the GBPUSD. It's early NY session peak stalled against the 1.3000 area which also happened to be at the 200 hour MA. Later - as London traders were bidding adieu for the day - the pair was able to push through the 1.3000 level and the 200 hour MA on it's way to new session highs at at 1.3050. The pair goes out for the day near that level. You can expect that the 200 hour MA (and 1.3000 level) will once again be earmarked as a support level to stay above. PS. the GBPUSD run up was helped by a deterioration of the EURGBP as it moved closer and closer to a key test at the 100 hour MA at the 0.8633. Keep that level in mind going forward.
As mentioned above, the USDJPY was under some good pressure in the early NY session, and just getting used to life under the parity level when Dudley comments ruined the shorts party a bit. The pair did recover against the greenback - rising to a NY session high of 100.52 before moving back toward the parity level toward the close. The low point reached 100.14, keeping a little distance away from parity. However, the sellers remain in control below the 100.487. That was the lowest close of the year before today's close. The market tends to remember such milestones. Above that level, the 100.71 level will also be eyed. That is the 50% of the move up from the 2011 low. With the correction in the NY session stalling at 100.52, I get the feeling that rallies might be sold in the new trading day. Be aware.
The USDCAD moved further away from the 100 day MA today (at 1.2934). That move occurred mostly in the Asian and London morning session. IN the NY session manufacturing sales rose by a greater than expected 0.8% (vs +0.5%). The low for the day was printed soon after the data, but Dudley's comments led to a pretty good short covering rally (about 90 pips once it was said and done). Oil prices remained supported (up a little less than 2% on the day) which should keep pressure on the USDCAD. The oil contract closed above the 100 day MA at the $46.10.
Below is a snap shot of the % changes of the major currencies vs. each other. The cumulative changes simply adds up the % changes of each currency vs. each other (it is not weighted like the US dollar index). It also does not represent a % change of the currency overall (so the dollar did not fall 5.88%). It simply adds the changes of the dollar vs. each currency and does that for each currency to rank relative strength and weakness.
