Forex headlines for August 27, 2014:

The GDP numbers were a bit better than expected but it was mostly priced in after the durable goods revisions earlier in the week. The US dollar initially jumped but it fell back in minutes. USD/JPY went to 103.88 and then back to 103.75. Similar magnitude moves elsewhere.

The details of the report had some reasons to be optimistic, especially an 8.4% rise in business investment but we’re near month end and and flows are a bigger factor than fundamentals. It’s clear the market had some US dollars to sell because there was no reaction in USD/JPY to the stock market. The S&P 500 opened lower and touched 1990 but it battled back to 1997 at the close. USD/JPY ebbed to 103.69 from 103.80 even as stock sentiment improved.

EUR/USD traded in a 1.3160 to 1.3190 range. When yesterday’s US low of 1.3165 broke there was some excitement about the downside but rumored bids at 1.3150 and/or an option barrier picked up the pair and it rode the dollar-selling trade to 1.3183.

Cable was quiet. We went back and tested the European low of 1.6567 but there was no appetite to break it. last at 1.6588.

USD/CAD consolidated its recent declines. Attempts to push below 1.0840 were beaten back and the range has been narrowing. There was some selling following the avg weekly earnings beat but nothing dramatic. GDP is tomorrow. Last at 1.0848.

AUD/AUD was confined to the European range and US trading saw a spread of less than 20 pips. Last at 0.9356.

Oil was a big mover as it cilmbed up to $94.62 from 93.60 on geopolitcal worries and oversold conditions. I suspect we’re hit a short-term bottom.