Forex news for North American trading on April 20, 2021
- Major indices close lower. Dow dipped below the 34,000 level
- Bank of Canada preview: It's taper time but outlook gap estimate is key
- WTI crude oil futures settle at $62.44
- Manchester City withdraws from European Super League
- Fed Powell sends response to Sen Scott: Too low inflation harms families and business
- European equity close: Rough day everywhere with losses around 2%
- CAD risk skewed for a dovish BOC taper and tactical USD/CAD upside - Citi
- New Zealand GDT price index -0.1%
- EU drug regulator finds blood clot link in Johnson & Johnson vaccine but says benefit-risk still positive
- US April Philly Fed non-manufacturing index 36.3 vs 27.4 prior
- Canada March Teranet house price index 10.8% y/y vs 9.8% prior
- The NZD is the strongest and the JPY is the weakest as NA traders enter for the day
For the 2nd consecutive day, the economic calendar was light, yet stocks moved lower and today. Bond yields were also lower after trading higher earlier in the trading day.
Looking at the US stock market, the major indices or close lower for the second consecutive day this week. Once again the NASDAQ index was the worst performer with a decline of -0.92%. In Europe, the major indices fell sharply with spend Ibex down -2.89%, Italy's FTSE MIB down -2.44% leading the downside moves. The European indices closed nearer the session lows. France's CAC and Spain's Ibex did not trade positive today. The Dow and S&P index also did not trade positive during normal trading hours today.
In the debt markets today, the US yields were higher earlier in the session with the 10 year trading as high as 1.631%. The yield near the end of the day was down at 1.561%, down -4.4 basis points on the day. Despite the move lower, the lower yields did not support tech shares is that correlation seems to have dissipated. Financials were sharply lower today and helped to lead to the decline in equities. J.P. Morgan fell -2.21%, Bank of America fell -2.78%, Wells Fargo fell -3.05%, Citigroup fell -3.24%.
In the European debt market, the 10 yields were mostly lower as well with the exception of France. The French 10 year yield moved more comfortably back above the 0.0% level at 0.077%. German yields are the only country with negative 10 year yields from the major European countries. The yield is at -0.262%.
In the forex, the JPY is ending as the strongest of the majors followed by the USD in what can be characterized as a rotation into the relative safety of those currencies. The CAD is ending as the weakest of the majors ahead of their interest-rate decision tomorrow. Adam previews that rate decision here.
The USDCAD based in the NY session against the 100 hour moving average near 1.2517, cracked above the 200 hour MA at 1.2538 and then the 100/200 bar moving average is on the four hour chart 1.2557. That ignited strong buying with the price moving up to the 50% retracement of the 2021 trading range about 1.26224. That level did stall the rally and the price consolidated above the 1.2600 level into the close (but below the 50% level).
The AUDUSD moved to a new high going back to March 18 in the European morning session, but then trended back to the downside. In the process, it cracked back below its 100 hour moving average at 0.77475 and more selling ensued. The low retested the low price from yesterday near 0.77056 and the low from last Thursday near the same level. The price low reached 0.77086, and trades at 0.7724 near the end of day close.
The EURUSD extended above its 100 day moving average at 1.20542 for the first time since March 4. However momentum cannot be sustained in the price is closing back below the moving average level. The current price is trading at 1.2036 just ahead of the close. It would take a moved back above the 100 day moving average to tilt the bias more to the upside.
In other markets:
- Spot gold rose $7.72 or 0.44% at $1779.15.
- Spot silver rose 3 cents or 0.12% at $25.85
- WTI crude oil futures for June delivery are trading down one dollar and three cents or -1.61% at $62.40. The May contract settled for good at $62.44.
- Bitcoin had a volatile down and up session. The price is currently up $790 or 1.4% at $57,000. The high price reached $57,082.07. The low price extended to $53,430.01
