Forex news for NY trading on January 20, 2020
- Macron/Trump agreed on truce on tariffs until the end of the year
- Guess what? No stock records today, but earnings season will be heating up over the next two weeks.
- The jump from trend to bubble is faster than ever
- European equity close: Soft start to the week
- Boeing talking to banks about borrowing $10 billion or more - report
- Canada Bloomberg Nanos weekly consumer confidence 56.1 vs 57.1 prior
- US natural gas prices are cratering
- Canada December Teranet house price index +1.9% vs +1.4% prior
- IMF: Growth is worse but at least uncertainty is lower
- IMF trims 2020 global growth forecast to 3.3% from 3.4% previously in October
- OPEC's Barkindo reportedly confirms next OPEC+ meeting to be held in March
US stock and bond markets were closed in the US in observance of Martin Luther King Day. As a result the forex market took a hiatus from trading.
Looking at the high, low, change chart below, the USDCAD is the farthest from the unchanged line at -20 pips from the Friday close. The GBPUSD recovered all but 9 pips of its early session decline. The rest of the major pairs vs the USD are closing all within 4 pips (of the unchanged line). Not a lot of price movement. The high to low trading ranges were likewise contained.
Taking a look at the % changes of the major currencies vs each other, the CAD is the strongest. The GBP is the weakest but lets face it, all the pairs are scrunched together with marginal % changes for the day.
The new trading day ahead will be more "normal".
- The Bank of Japan will announce that they will keep rates unchanged and the market will be focused on the press conference.
- In the UK, they will release unemployment data.
- Germany will release the ZEW economic sentiment as will the Eurozone.
- The World Economic Forum will get underway in Davos,
- European finance ministers will gather in Brussels to discuss economic policy in respective countries.
- There are no economic releases in the US,
- Canada will release their Manufacturing sales.
- In geopolitical news, the US impeachment trial will get underway in the US afternoon.
Some technical levels to eye going into the new trading day:
- The EURUSD failed on breaks to new lows in 2019 (below 1.1084-86, and a lower trend line (see post here). The failure has given the buyers some ammunition to take the price higher. Gettiing over 1.1100-04 will have traders looking toward the 38.2% at 1.11127. Above that sit the falling 200 hour MA at 1.11207 and the 100 hour MA at 1.11239. ON the downside, a move back below the 1.10843 could see the dip buyers give up and look instead toward the 100 day MA at 1.10623 area.
- The USDJPY remains above its 100 hour MA at 110.057 ahead of the BOJ decision. A move below it in the new day has the rising 200 hour MA at 109.83 and the swing high ceiling from December at 109.675-723 as targets. On the topside, the 61.8% of the move down from the October 2018 high comes in at 110.684 (also near a swing high from May 2019. KEY level. A topside trend line above that at 110.863 would be another level to target.
- The GBPUSD fell into midday, and retraced the move in 2nd half of the day today. At the low at 1.29613, the price got close to swing lows from earlier this month at 1.29596 and 1.29537. The highs in the Asian and London/NY sessions today reached 1.3008 where the price is going out near. A move above that level should have traders looking toward the 100 hour MA at 1.3030 and the 200 hour MA at 1.30361. It will take a move above each to turn the bias back more to the upside for the pound. Failure to take out the area with momentum could see a rotation back down toward the January lows at 1.29537 to 1.29613.
- The USDCAD fell back below its now converged 100 and 200 hour MAs at 1.30534. The price is trading at 1.30443 into the close for the day. Stay below those MAs will have traders looking toward swing lows between 1.30283 and 1.3034 (from Jan 10 to Jan 17). A move below that floor area should open the downside for more selling. A move above the MAs will target a ceiling area at 1.30747 to 1.30788 (from Jan 10 to Jan 17 too). At some point there will be a break of the floor area or break of the ceiling area.
