Forex news for NY trading on September 29, 2017.
- It's official. Tom Price has resigned as US Health and Human Services Secretary
- Stocks end September/3Q with gains
- CFTC Commitments of Traders: EUR longs increased. GBP position long for first time since Oct 2015
- End of 3Q and stocks are at record levels. When do you worry about your stock investments?
- Bitcoin technicals: Guess where bitcoin bounced?
- Baker Hughes rig count for the current week totals 940 vs 935 last week
- Fed's Harker speaks to reporters: We are in a period where we can be patient
- Dallas Fed trimmed mean PCE price index +1.5% vs +1.4% prior
- There's a pattern in USD/JPY and the Nikkei when Japanese elections are called
- European stocks end the week on a positive note
- The Atlanta Fed's GDPNow estimate for 3Q raised to 2.3% from 2.1%
- NY Fed GDP Nowcast down to 1.5% from 1.6% last week
- Fed fines HSBC $175 million for unsafe and unsound FX trading
- US orders departure of nonessential diplomats from Cuban embassy
- Traders give up on the dollar buying as the week, month, quarter close approaches
- Trump is said to have met with other Fed contenders as well - report
- Final U Mich consumer sentiment 95.1 vs 95.3 expected
- Trump said to meet with Kevin Warsh about Federal Reserve leadership - report
- Chicago PMI 65.2 vs 58.7 expected
- September forex scorecard: GBP/JPY the winner, seasonal patterns miss
- Another month, another weak US inflation reading
- OPEC output rose 150K bpd in September
- Canada GDP for July 0.0% vs. 0.1% estimate. Producer prices 0.3% vs 0.5%
- US August PCE core +1.3% y/y vs +1.4% expected
- US August personal spending +0.1% vs +0.1% expected
- The EUR is the strongest and the GBP is the weakest. EURGBP on the move.
In other markets, the snapshot near the end of trading for the day, month and quarter shows:
- Spot gold fell -$7.80 to $1279.54
- WTI crude oil is trading near unchanged levels at $51.59
- US yields are higher in the short end, 2 year 1.4827%, up 3.1 bp. 5 year 1.9360%, up 4.2 bp. 10 year 2.3354%, up 2.6 bp. 30 year 2.8617%, -0.9 bp.
- US stocks ended the day with gains. S&P up 0.37%. Nasdaq up 0.66%. Dow up +0.11%
At the end of the day, week, month, quarter the broad market stock indices closed higher and at record levels (the Dow did not make a record close but the S&P, Nasdaq and Russell index each did). Gains for the month showed the S&P rose 1.93% and Nasdaq up 1.05%. For the quarter, the gains showed S&P up 4% and the Nasdaq up 5.8%. Not a bad return for 3 months. The YTD ends with the S&P up 12.53% and the Nasdaq up 20.67%. It remains hard to keep the stock market down. The broad market indices have not closed below their 100 day MAs since November 2016.
Also at the end of the day, week, month, quarter, the beleaguered and maligned Home and Health Service Secretary Tom Price resigned. The failure of the repeal and replace of Obamacare and more recently the abuse of private jets, sent the ex-representative, orthopedic physician on the late Friday walk of shame. Whether it was the expense blunder, or the healthcare failure dressed up as the expense blunder, we will never know. What I wonder is if he dropped off the check to treasury department for the flights yesterday? We may never know that either.
Fundamental news today showed that Personal income and spending came in as expected but lower than last month. The PCE data, a favorite inflation measure of the Fed, showed the Core YoY fall to 1.3% from 1.4% and the headline 1.4% vs 1.5% estimate. Not good but Fed's Harker has still penciled in a hike in December (although he did emphasize "penciled in").
The Chicago PMI data did send the greenback higher as it handily beat the expectations (65.2 vs 58.7). One regional Fed estimate of 3Q GDP fell to 1.5% from 1.6% (NY Fed) while the other estimate showed a rise to 2.3% from 2.1% (Atlanta Fed). The GDP for the 2Q yesterday came in at 3.1% but the hurricane is expected to rob from the 3Q and give back in the 4th quarter.
As far as the forex market today, the numbers show the EUR was the strongest currency today while the CAD was the weakest. The USD was up against more currencies than it was down, but it did lose against the EUR and the CHF.
For the EURUSD the pair continued the corrective move started yesterday when the pair could not get below a cluster of support at the 1.1711-20 area. The rise today moved back up to test the 1.1822-275 area (high reached 1.1832). The significance of that area was it was the low floor of the 22 plus days from August 25th to September 26th. That level was broken this week, the range for the month was extended, the key cluster of support was tested. In next weeks trading that area (make it getting above 1.1822-37) will be the bulllish above/bearish below line in the sand.
Key level for the GBPUSD remains the 100 hour MA (blue line in the chart below). The MA has been tested 5 times and twice today and yesterday, and each time found sellers. It comes in at 1.34218 currently. Stay below, more bearish and the price can wander down to the lower and falling trend line. Move above and we start to dig and retrace back into the levels to the topside.
The USDJPY held the 200 hour MA today (at 112.20 now - see green circles). The 100 day MA is below that at 111.99. A move below those levels in the new week should solicit more selling.
On the topside, the 112.815-93 was a swing level going back to June/July. That level was broken twice this week (two bars on each break) and each failed. Not good for the bulls. So that is a ceiling again. Stay below bears remain in control. Move above and it is the start of the 3rd try. Will it be a charm and the price trend higher from there. Only the "market" knows (i.e. the buyers need to beat up on the sellers). We will know if the price stays above the level.
