Session Wraps - Major Forex Headlines wrapped up by trading session

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Forex news for North American trading on September 24, 2021

The CAD and the USD is ending the day as the strongest of the major currencies as the flow of funds into the CAD were by higher oil prices, and the US dollar continues to be supported by higher yields and perhaps a little flight to safety (although stocks did recover most of their losses by the close).  

The NZD is the weakest along with the AUD. Evergrande missed making payments to some of its bondholders, but technically has 30 day grace period to correct the situation.  However, that is not expected.  Although there is some anxiety, the market is becoming more comfortable with the idea of a default. Nevertheless, currency pairs like the NZD and the AUD took the brunt of the selling pressure today in the currencies.

Forex news for North American trading on September 24, 2021_

For the EURUSD, it fell back below its 100 hour moving average at 1.17248 and was able to stay below that level through out the US session. The pair also did find support near the 1.1700 level (there is a swing area from 1.16996 to 1.17054).   Close support held. Close resistance held.  Next week traders will be eyeing those levels for the next bias clues.

The GBPUSD is closing near the lows for the day and just below the 100 hour MA at 1.36713. The pair this week traded toward the August 20 low at 1.36016 (the low reached 1.3608 on Thursday and shot higher after the BOE more hawkish rate statement on Thursday. The high price stalled right at the 200 hour MA and found willing sellers. Today, the price was able to extend below the aforementioned 100 hour MA at 1.36713. That sends the pair into the weekend with a bearish bias.  

The USDJPY broke to the highest level since August 11 today. The high reached 110.787 which was just short of that high at 110.793.  The price is currently trading at 110.74, now far from that level, but will need to shove above the level next week, if the bullish bias is to continue unabated. 

The USDCAD moved higher and then back down, largely helped by the downs and ups in crude oil. The price of crude oil is closing up $0.63 at $73.93 after trading as high as $74.27, but also traded as low as $72.81 intraday. The swing lows from September 19 and September 23  is the next major target on further selling at 1.2633 to 1.2638.  In the new week, that swing area would need to be broken to increase the bearish bias. The pair is currently trading at 1.2644.

The AUSUSD moved below its 100 hour MA at 0.7260 to a low of 0.72355, but has rebounded back toward the 100 hour MA into the Friday close.  That MA will be the close barometer for the buyers and sellers in the new week. 

In other markets today:

  • Spot gold is trading up $5 at $1747.70
  • Spot silver is trading down ten cents or -0.42% at $22.38
  • Crude oil is trading at $73.94 into the close. That is up $0.64 or 0.87%
In the US stock market, the Dow and S&P closed higher. The Nasdaq closed lower but closed near session highs.

  • Dow rose 33.18 points or 0.10% at 34798.01
  • S&P rose 6.48 points or 0.15% at 4455.47
  • Nasdaq fell -4.53 points or -0.03% at 15047.71
In the US debt market, the 10 year yield moved to a intraday high at 1.466%. That was the highest since early July.  The yield for the benchmark issue traded as low as 1.297% this week, before reversing and going higher

US yields are higher..

Thank you for all your support. Have a great weekend. 

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Author: Justin Low

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Forex news from the European trading session - 24 September 2021

Headlines:

Markets:

  • CHF leads, AUD lags on the day
  • European equities lower; S&P 500 futures down 0.4%
  • US 10-year yields up 1.2 bps to 1.421%
  • Gold up 0.6% to $1,752.14
  • WTI down 0.2% to $73.15
  • Bitcoin down 8.1% to $41,100

The session started off with more tepid sentiment in general but equities are seeing a slight pullback after the gains in the past few days as the week winds down.

Evergrande and China fears are still lingering for the most part, providing some room for caution despite the greed put forward by dip buyers post-FOMC this week.

European indices are lower across the board, with modest losses observed but nothing overly dramatic. For some context, the DAX is down 0.7% but that still isn't enough to erase the gains yesterday and on the week, the index is still up 0.3%.

That may not seem like much but don't forget that the week started off with a 3% plunge on Monday amid a broad market selloff at the time.

Anyway, FX was more straightforward as higher yields kept the yen lightly pressured while the dollar is keeping a decent advance amid a softer risk mood.

EUR/USD gradually eased from 1.1730 to 1.1715 while GBP/USD also fell from its post-BOE highs around 1.3710 to 1.3675 as the dollar keeps firmer.

Commodity currencies are the notable laggards with USD/CAD moving up from 1.2670 to 1.2700 and AUD/USD falling from 0.7290 to 0.7250 on the session.

Among the main stories in the market today is the plunge in cryptocurrencies as China vows a harsh crackdown, stating that all crypocurrency-related activities are illegal and that they will be clamping down hard on that (a repeat message but still, a fresh one).

Bitcoin was dumped from $44,800 to $40,700 as price tests its 100-day moving average again while Ether sold off by more than 12% at one point to a low of $2,736.

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Forex news for Asia trading on Friday 24 September 2021

The sustained 'risk on' FX moves seen overnight through Europe and US timezone trade were retraced just a little during the session here in Asia on Friday. Its not like there were any reversals, just a little bit of back-filling, at this stage anyway.

AUD/USD initially moved back above 0.7310 but failed to carry on higher beyond that level and has subsequently backed off circa 0.7290 as I update. The pattern has been similar for EUR/USD, NZD/USD and cable. USD/CAD is up 30-odd points while USD/CHF and USD/JPY are not too much changed at all.

News flow has been very light. On the data docket, the main event was Japanese inflation data for August, with the 'core' rate hitting zero % y/y, its first time above a negative result in a year. There is often not a lot of encouragement in these figures for the Bank of Japan, where the target for core CPI is 2%, and I don't imagine zero percent triggered much celebration there.

Evergrande developments were keenly sought, but there have been none. A USD83m payment due Thursday has not been paid, bondholders are praying they get something in the 30 day 'grace period' that need to pass before a 'default' is recorded.

Regional stock markets took their cue from the rises in the US overnight, Japan up (partially a catch up move from its holiday Thursday) but China and HK are little changed. 

USD/CAD:

Forex news for Asia trading onFriday24September 2021

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Forex news for US trade on Sept 23, 2021:

Markets:

  • Gold down $21 to $1747
  • S&P 500 up 53 points to 4448
  • WTI crude oil up $1.00 to $73.22
  • US 10-year yields up 9.2 bps to 1.42%
  • NZD leads, JPY lags
With the Fed out of the way and more indications that China is prepared for Evergrande (and could even stimulate real estate) the market embraced the warm-and-fuzzies with a classic risk-on move, the kind we haven't seen in awhile.

That meant higher stocks, higher commodities, a jump in risky FX and, notably, higher yields. The rates market used to work with stocks in that way but more recently, there have been times when higher yields cause fright in equities. It's particularly stark today given such a large move to a two-month high in yields.

Ultimately though, 1.42% 10-year rates are still extremely low by historical standards and we could be seeing a shift back to the reflationary trade.

In terms of correlations, it was what you would expect with the dollar doing better against the low-yielding yen, euro and franc. USD/JPY held a steady bid to finish a half-cent higher at 110.30. That pair has been dead for months but it will be one to keep an eye on if this move in yields continues.

It wasn't just US rates that moved up so the rest of the world kept pace with the dollar and the better mood provided strong backing for the commodity currencies. AUD and NZD were strong in New York while the loonie moved earlier.

Cable liked what it heard from the BOE but the rally in GBP was mostly about the risk trade, as it kept pace with the commodity currencies. GBP/USD is still only half-way back to the Sept 15 open so it's way too soon to draw any conclusions but the rally looks to have formed a triple bottom at the Aug and July lows.
Forex news for US trade on Sept 23, 2021:

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