Forex headlines for May 27, 2014:
- US durable goods orders April +0.8% vs -0.5% exp
- Capital goods orders non-defense and excluding aircraft -1.2% vs -0.3% exp
- Large upwards revisions to prior durable goods report
- US March Case-Shiller house price index +12.37% y/y
- US March FHFA house price index +0.7% vs +0.5% expected
- US May Markit services PMI 58.4 vs 54.5 exp
- US May consumer confidence 83.0 vs 83.0 expected
- Draghi: ECB will do everything feasible for the economy within its mandate
- May Richmond Fed +7 vs +5 expected
- Dallas Fed manufacturing +8.0 vs +9.2 expected
- ECB’s Costa says there is no deflation risk in eurozone
- IMF’s Blanchard says there is a risk of deflation in eurozone
- EONIA sets at highest since quarter-end
- Philly, KC and Dallas continue to vote for hikes in discount rate minutes
- BOE’s Carney speaks about regulation not monetary policy
- Goldman Sachs lowers US growth forecast, sees H2 at 3.25%
- S&P 500 up 11 points to record 1911
- Gold down $27 to $1266
- WTI crude down 23-cents to $104.13
- AUD leads, CHF lags
Gold grabbed the headlines today as a wedge formation broke and triggered a flurry of selling. Stops continued to break below the May and April lows and gold continued down to a three-month low.
The move in gold hinted at a broader dollar rally but the USD gains were modest. But look even closer and there were a few technical reversals (outside bullish/bearish days) that point to potential USD moves.
USD/JPY fell as low as 101.73 in Europe but turned around and climbed to a two week high at 102.14. A close at those levels would have been especially bullish but the pair faded back to 102.00, leaving it in the mushy middle.
Same kind of story for EUR/USD as what looked like a reversal to the lows at 1.3613 wouldn’t hold and bounced up to 1.3632 which is right back to the 200dma.
Cable was a bit more definitive as it painted a reversal that covered the two previous days and although it bounced late to 1.6805 from 1.6782, the chart is a bit uglier than elsewhere.
AUD/USD was in a 50 pip range from 0.9234 up to 0.9278 and that qualifies as a fairly volatile day in this market. It finishes right in the middle of the range.
USD/CAD made a fresh short term low but didn’t like the feel of things at 1.0836 and the pair was mostly bid in North American trading as it climbed up to 1.0870.