Forex news for NY trading on September 28, 2016
- US stocks close up (and near highs) in down and up day
- Forex technical analysis: USDCAD jumps as details of agreement come out
- More details on the OPEC deal
- Deflation needs better PR
- Iran oil minister confirms OPEC has reached a consensus
- Forex technical analysis: USDJPY a little more bullish...
- So it looks like Americans will be suing the Saudi government
- OPEC said to be discussion cuts of 700K to 200K barrels per day - report
- OPEC will limit output to 32.5 mbpd - RTRS
- OPEC reaches deal to limit oil production, to be executed in Nov - RTRS source
- Oil is trading BOJ-style as the Algiers meeting continues
- Fed's Evans: Risk over overshooting or even hitting Fed inflation target is lower than most believe
- USD/CAD retreats from big levels but it hinges on oil as we await OPEC
- Yellen: Inflation below 2% gives us some room to focus on employment mandate
- Senate overrides Presidential veto on bill to let Americans sue Saudi Arabia
- Two reasons to remain skeptical about oil and OPEC - Goldman Sachs
- ECB's Villeroy: Growth is leveling off in Europe
- For rates to go up later, they have to be low now says Draghi
- Draghi: Our measures are effective because a recovery is taking place
- Has Draghi just threatened Germany?
- A sour mood settles over markets, Dollar bid
- Yellen: Majority of FOMC see a rate rise likely needed this year
- IMF's Lagarde says cut coming to US growth forecast
- EIA weekly US oil inventories -1882K vs +3000K expected
- Brexit legal challenges mount up for May
- Nothing on monetary policy in the opening remarks from Bullard
- Atlanta Fed GDPNow Q3 forecast trimmed to 2.8% from 2.9%
- It won't be OPEC that drives oil prices, it will be technology
- Kashkari: US growth will remain moderate at around 2.0-%
Economic data
- US August durable goods orders non-defense ex air+0.6% vs -0.1% exp.
The US Durable goods data today came in better than expectations for August but was not as great when factoring revisions from July. As a result, GDP estimates were revised a touch lower to 2.8% from 2.9% according to estimates from the Atlanta Fed GDPNow estimate. The estimate has moved from a high of 3.7% the current 2.8% since the beginning of August.
OPEC surprised by announcing that a production cut was agreed. The question becomes what will the details look like? The details are that production will be cut from 33.2 mbps to something like 32.5 to 33.0. The split will be decided by November. Crude oil rose on the headlines and trades at $47.00, up +5.22% on the day.
In other news, Chair Yellen said the majority of FOMC members likely see a rate rise this year. That makes sense from the dot plot from the last FOMC meeting last week.
As far as currency moves today, the CAD got a boost on the back of the rising oil prices. The NZD was the weakest currency but recovered a lot of the losses in the NY session. The USD was mixed with gains against the JPY and NZD, down against the CAD and the AUD and little changed against the EUR, GBP and CHF.
The USDCAD is ending the day at the lows for the day, and also at new lows for the week. As outlined above crude oil is up over 5% on the day, and that was enough to push the loonie up and the USDCAD lower. Technically, the price fell below the 1.3128 level which was the lowest swing low in a string of lows that occurred from Sept 14 to Sept 21. Staying below that level is more bearish technically for the pair.
As for the EURUSD although the price moved down and back up and ended near unchanged, the pair bounced off the 100 day MA twice in the day (at 1.1183). That is worth something should the price head back to that level in the future (or if it goes through the level).
The GBPUSD meanwhile had little redeeming qualities in it's trading today. The range for the day was 52 pips which was the lowest range going back to March 2016 (the range on March 25 was 49 pips). Up and down, up and down would be how to characterize the day.
For the USDJPY, a picture is worthy of showing. It is an hourly chart and as you can see the upper and lower trend lines are getting closer and closer together. Something has to give soon, right? Be on the lookout in the new trading day.
Stocks were higher on the day with the S&P up 0.53% and the Nasdaq up 0.24%.
Bond yields were up 1 to 2 basis points on the day.
Below is a snapshot of the winners and losers in trading today.
