Forex news for NY trading on September 27, 2018
- US stocks end higher but off the highs
- Italy's De Maio: Succeeded on budget for the people
- Crude oil futures settle at $72.12
- ECB Praet: You don't just raise rates as a buffer to cut again
- Govt Source: Italy's League and 5-Star insist on 2.4% deficit target
- Fed's Kaplan speaks on panel in Charlotte on minorities in banking.
- Italy gov't aims for 2.4-2.5% deficit target - report
- ECB Praet: There are signs that valuations are stretched in specific mkt segments
- US 7 year note high yield comes in at 3.034%
- US treasury to auction $31B of 7 year notes at 1 PM ET/1700 GMT
- European stock indices end the session with mixed results
- The banks always win: Italian govt weighing state guarantee on bad loans
- Saudi Arabia will add 550-600K of oil output capacity in Q4 - report
- Atlanta Fed GDPNow tracker for Q3 cut to 3.8% from 4.4%
- KC Fed manufacturing activity +10 vs +10 prior
- UK foreign minister Hunt: Chequers is basis of an agreement
- US August pending home sales -1.8% vs -0.5% expected
- Gold hits a one-month low
- Trudeau: 'Still very possible' to get a good, fair NAFTA deal
- US August prelim durable goods orders 4.5% vs 2.0% expected
- US August advance goods trade balance -$75.8B vs -$70.6B expected
- US August wholesale inventories +0.8% vs +0.3% expected
- US initial jobless claims 214K vs. 210K expected
- US Q2 GDP (third look) +4.2% vs +4.2% expected
- The USD is the strongest and the CHF is the weakest as NA traders enter
A snapshot of other markets near the day's close shows:
- Spot gold fell sharply on the back of the higher dollar. The price is down -$11.40 or -0.96% at $1182.90
- WTI crude oil futures closed higher with Iran sanctions and a report that US Energy Sec. Perry will not release reserves from the strategic petroleum reserves The price is trading up $0.56 or 0.80% at $72.14
- Bitcoin rallied in afternoon trading and is up $187 at $6684. The digital currency got a boost on the break of the 100 and 200 hour MAs (blue and green lines in the chart below).
In the US stock market today, the major indices closed higher but off the highs. The European stocks ended the session mixed. After the US close the SEC has sued Elon Musk. The stock is trading down -$31 or 10.15% on the day at $275.50
A summary snapshot of the US debt market is showing that yields are ending with gains. The 2 year is up the most (up 1.2 bps). The yield curve has flattened (down -0.7 bps).
The 10 year benchmark yields ended the session mixed.
The USD was the strongest currency of the major currencies. That was helped by some better data.
- The durable goods rose by a greater than expected 4.5% vs. 2.0% expected.
- The US jobless claims continued to show strong employment.
- Inventories rose,
- GDP for the 2Q (old news) stayed steady at an above trend 4.2%.
- The goods trade balance ballooned higher to -$75.8B.
The market interpreted the data positively. The dollar rose and the trend was on.
For the EURUSD, the pair opened the NY session at 1.1719 and trended lower through the day. The move took the price down to a low at 1.1638. That took the price below the 100 day MA at 1.1651 in the process. In the new day, that MA will help to define the bullish or bearish bias. Stay below is more bearish. A move above it, and there should be some corrective price action
The USDJPY started the NY session at 112.82 area. The price rise on dollar buying, sent the pair to a high of 113.46 before dipping a bit into the close (at 113.38). The move took the price above the January 2018 high at 113.38 but only by 8 pips. So, yes, there is a new high, but momentum did slow and there is a risk in the new day, that if the high for the day is not taken out, the buyers could turn to sellers. Be aware.
The USDCHF was the biggest mover of the day, rising by 1.12%. The NY trading session saw the price move up from around 0.9710 to a high of 0.9782. The day closed at 0.9772 area. The range from the low (in the first hour of trading), to the high was 135 pips. The pair closed up 108 pips on the day. Technically, the pair moved above the 200 day MA at 0.97279. That level will be risk going forward for the pair. Stay above is more bullish. The June swing low at 0.97878 will be eyed as a topside target to get and stay above now. Above that, the 50% midpoint of the move down from the July 2018 high comes in at 0.9804.
The GBPUSD also fell on the day and closed near the lows. The pairs change was less than the USDCHF and the EURUSD, but it still fell by 0.67% on the day. Technically, the price moved away from the 100 day MA at 1.3133, closing at 1.3078. Bears took control. The pair is still above last Friday's low at 1.3054 (low reached 1.3073) and the Monday low at 1.3062. That area will be a support target in early trading. Stall and there should be a corrective move higher. Break below and a further run lower could be expected.
The USDCAD was the most stable of the major pairs against the greenback. The pair still ended the day higher, but the did move to unchanged in the NY afternoon session (closed yesterday at 1.3016 and the NY session low reached 1.3015). The price closed the day at 1.3040. Technically the price traded above and below the 100 day MA at 1.3052 in the day, but the late day rally did stall against that MA level. The price closed below the MA line. As a result, traders in the new day will use the level to lean against. If there is a break above, look for the sellers to turn back to buyers.
