Forex news for US trading on April 21, 2016:
- ECB leaves interest rates unchanged and QE at €80bn
- Draghi opening statement: We see rates at present or lower levels for extended time
- Draghi Q&A: ECB hasn't discussed helicopter money
- Full text of Draghi's introductory ECB statement
- US initial jobless claims 247k vs 263k exp
- Japan Post to shift to riskier assets
- March US leading index +0.2% vs +0.4% expected
- April 2016 Eurozone consumer confidence -9.3 vs -9.3 exp flash report
- Libya says could double oil output within weeks after political pact
- February 2016 US FHFA house price index 0.4% 0.4% exp m/m
- The Philadelphia Fed business outlook for April -1.6 vs. 9.0 estimate
- March 2016 US Chicago Fed national activity index -0.44 vs -0.15 exp
Markets:
- Gold up $4 to $1248
- WTI crude down 64-cents to $43.55
- US 10-year yields up 2 bps to 1.86%
- S&P 500 down 11 points to 2091
- JPY leads, NZD lags
The euro raced 50 pips higher ahead of the ECB press conference and the continued another 50 pips higher when Draghi expressed some optimism about lending and preached patience. But offers at 1.1400 contained the move and after the press conference the gains completely reversed down to 1.1270 as the dollar bulls pulled the strings.
Cable was caught in a similar yo-yo. It dropped on soft UK data then ran up 130 pips to 1.4440 as Draghi spoke only to be crushed back down to 1.4324. Both the euro and cable left doji formations on the chart in what could signal more trouble ahead.
USD/JPY was less volatile as both gained against the rest of the field. The pair started at 109.75 in US trading and held a slight negative tone as risk assets slipped.
The commodity currencies suffered as oil fell for the first time this week. USD/CAD touched 1.2625 early but it was steadily higher from there up to 1.2750.
AUD/USD touched a fresh 9 month high but it also reversed and then hit stops below 0.7800 in a skid down to 0.7740. I looked at the technical implications of the reversal.
