Forex news for North American trading on February 9, 2021
- No records for the Dow and S&P. Nasdaq and Russell 2000 have record closes
- WTI crude oil futures settle at $58.36
- Biden supports 75K treshold for stimulus checks
- While most markets trade quietly, Bitcoin moves back higher.
- US treasury auctions off $56 billion of 3 year notes at a high yield of 0.196%
- Ford says chip shortages temporary
- European shares end mostly lower
- Head of Italy's League Party weighs in on Mario Draghi meeting
- Senate Maj Leader Schumer: Democrats working toward getting minimum wage increase
- JOLT job openings 6646K vs 6400K estimate
- Head of Italy's PD party very satisfied with talks with Draghi
- Fed's Kaplan: Sees strong boost to GDP growth in 2021
- The CHF is the strongest and the USD is the weakest as NA traders enter for the day
I tend to start each day, by ranking the strongest to weakest of the currency pairs. Today, the Swiss franc was the strongest followed by the JPY. The weakest currencies were the USD and the NZD. Below is that ranking from around 7:20 AM ET.
At the end of the day, the Swiss franc and the JPY remain the strongest, and the USD followed by the NZD are the weakest.
In fact, if you looked at the rankings of the 8 major currencies, the order was exactly the same at the start of the day, as it was at the end of the day.
Now there were little wiggles here and there:
- The GBP was marginally lower and ended higher.
- The USD turned more to the downside
- The NZD got weaker while the AUD was marginally higher
- The CAD weakened while the JPY weakened but stayed positive.
The point is, however, the integrity of the day was fairly consistent. It does not always happen that way.
Some technical levels that are in play into the new day for some of the major pairs:
- EURUSD: The EURUSD tested a topside trend line on the hourly chart in the London morning session, and backed off. However after rotating down toward support near 1.2086 and finding buyers, the pair extended above its trend line at 1.2115. The prices just above that level after trading to a session high of 1.2121. Now it is the end of the day, and there can be some countertrend moves, but watch the 1.20982 level for early support. That level corresponds with the 61.8% of the move down from the January 22 high to the February 5 low. If support can hold above that level, the buyers would remain in control.
- USDJPY: The USDJPY tumbled lower into the London morning session cracking below the 200 hour moving average, the 38.2% retracement at 104.83, but found support near the 50% retracement at 104.542. In the New York session the pair went sideways in a more narrow trading range of about 20 pips. During that time it trading marginally below the 50% retracement to a low for the day at 104.49. However, that level could not get to and through the key 100 day moving average at 104.39. In the new trading day, the 50% will be a barometer but so too will the 100 day moving average if the price dips toward that level. A break below would be more bearish. Staying above and we could see a corrective move higher on Friday after 3 days to the downside for the pair.
- GBPUSD: The GBPUSD step higher in the New York session and is closing near the highs for the day and the highest levels going back to April 2018. The move to the upside has also taken the price above the 1.3800 level. The price currently trades at 1.3812. In the new day if the buyers can hold above the 1.3800 level, that would be the most bullish scenario. Move back below and we could see a corrective day to the downside. However the old ceiling between 1.3745 and 1.3758 is now a floor. I would expect buyers to come in ahead of that area. The GBPUSD has been up for 4 consecutive days after tumbling to 1.35608 on Thursday's trade (lowest level since January 18 and a failed break below a floor at 1.3611.
- USDCHF: The USDCHF trended to the downside today and closed near its lows for the day. It also closed in a low swing area between 0.89166 and 0.89212. That area was a ceiling going back to January 11 (there were two breaks above that area that failed on January 18). The ceiling was broken on February 1 and led to a steady rally up to the highs seen on Thursday of last week at 0.90447. Since then, the price has moved lower over the last three trading days. In the new trading day, the the market will have to decide if going below the old ceiling/now floor is the next shove, or is it time to rebound. The 50% retracement of the range since January 22 at 0.9413 is an upside target if a bounce is forthcoming. Get above that level takes some of the pressure off the dip buyers (and gives them a little more control).
In other markets:
- Spot gold is trading up $6.57 or 0.36% of $1837.37.
- Spot silver is trading down 1 center -0.05% $27.25
- WTI crude oil futures traded above and below the unchange line in the New York session on his trading up $0.36 or 0.62% at $58.34
- Bitcoin traded as high as $48,200 as low as $44,300. The price is trading at $47,170
In the US stock market today, there were only new all time close records in the NASDAQ and Russell 2000 index today. The S&P and Dow industrial average closed marginally lower.
In the US debt market, in the US treasury successfully auctioned off 3 year notes with decent demand. Tomorrow and again on Thursday, the treasury will auction off 10 and 30 year issues. Yields have been rising the most in that sector. With yields higher, will investors gobble the newest is up. Today yields are ending marginally lower with the 10 year down -1.4 basis points and the 30 year down -0.5 basis points.
