Session Wraps - Major Forex Headlines wrapped up by trading session

Author: Eamonn Sheridan
2

ForexLive Asia FX news wrap: China moves the forex again

Forex and Bitcoin news for Asia trading Friday 17 August  2018

The People's Bank of China added a little strength to the onshore yuan today (reference rate set at 6.8896) after 6 days of devaluation. There was a range of expectations for the central rate, those I had seen were on a mid to high 6.9 figure (after 6.8946 Thursday). The market response (not huge, but noticeable nonetheless) of a quick gain for the AUD (for example) was indicative it caught a few by surprise. I don't want to read too much into the set today, but it was perceived as a further slight easing in US /China tensions following the announcement of the low-level taks to take place later in July on trade just yesterday. Let's see how that plays out (my hopes are not high), but it was enough for a pop in risk.

AUD, as already mentioned, and elsewhere on the forex: EUR, NZD, CAD, even GBP. Regional shares also added a little.

Apart from that moves were subdued, as was news and data.

We got a three hour testimony by RBA Gov Lowe and other officials in parliament. The market paid the central banks a compliment by pretty much ignoring their familiar comments and leaving AUD barely changed (the pop came on the PBOC as explained above).

As I update the offshore yuan is weakening again …



Still to come:
Something for the weekend (free forex training manual!):
RIP the legendary Aretha Franklin




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Author: Greg Michalowski

Forex news for NY traders on August 16, 2018

In other markets:

  • Spot gold is down -$1.00 or -0.09% at $1173.85
  • WTI crude oil futures are up $0.50 or 0.83% at $65.50
Stocks in the US ended the day higher with a rotation into the Dow stocks. Some of the high flying Nasdaq stocks like Facebook, Netflix, Alphabet, Nvidia ended the session lower.  The big gainers in the Dow included Walmart, Boeing, Caterpillar and Cisco. European stocks ended higher with the exception of the Italian FTSE MIB which got hammered as a result of the bridge tragedy in Genoa. 


US yields saw the front end rise modestly. The 30 year bond yield fell modestly.


In the forex market, the NZD and AUD were the strongest currencies of the day on "risk on" flows.  In contrast, the CHF and the JPY were the weakest on flights out the safety of those two currencies. The USD was mixed on the day with the greenback higher vs the CHF, JPY and CAD, and down vs the NZD, AUD, EUR and GBP. 



Fundamentally today, 
The flows today were dominated mostly by the overnight news that US and China would talk.  That led to the Pavlovian reaction of higher NZD and AUD and lower JPY and CHF. The USD tends to move sideways  to lower and that is what it did today. Economic data had limited impact. 

The news - along with favorable earnings from Walmart and Cisco and an upgrade of Boeing - sent the Dow stocks soaring, but later in the day, Larry Kudlow characterized China's economy as terrible and the US economy as "crushing it".  That type of rhetoric did not really help some of the tech stocks and they drifted lower.  Although the Nasdaq closed higher, some of the familiar names were lower (or gave up most of their gains). 

We are heading into a Friday in the summer which can make price action even more random but here is the best stories for some of the technicals:

  • The EURUSD moved back above its 200 week MA at 1.1356. IN the NY afternoon, the price move to a NY session low of 1.1347, but is closing back above the bullish above/bearish below barometer heading into the last day of the week. Does it matter given the summer market?  I still consider it a barometer for bull/bear
  • The USDJPY was a currency pair that saw a bunch of ups and downs in trading today.  I am not sure I trust much in this pair but if I were to trade, I would look to buy near a support level (like the trend line on the hourly chart at 110.55) or a resistance level like 111.18.  In between may be more random.
  • The GBPUSD has the 100 hour MA bearing down on the price. That MA comes in at 1.2732 and although the price moved above that MA like it did on Tuesday, also like Tuesday, it failed quickly. The price is not racing lower - the 1.2661 is the low for the week and the year - and is the target to get below if the 100 hour MA cannot be broken. 
  • The USDCAD held support at the 100 hour MA today at 1.31218 and held under resistance at the week's highs at 1.31699 and 1.31742. Those are the extremes for traders to get above or move below (or bounce off of). 

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Author: Justin Low

Author: Justin Low
1

Forex news from the European trading session - 16 August 2018

Headlines:

Markets:

  • AUD leads, JPY lags on the day
  • European equities higher, only Italy's MIB is lower
  • Gold up 0.32% to $1,178.60
  • WTI up 0.06% to $65.05
  • US 10-year yields up 1.5 bps to 2.877%
  • Bitcoin up 0.20% to $6,388


The trading ranges for the day are pretty decent as we head into US trading but a lot of the move came from an earlier spike in Asian trading here. European trading went by a little quieter with risk sentiment improving a little helping to support the mood seen from Asia but doing little to see any notable extensions.

Perhaps, the notable thing so far today is that there is a bit of a market anomaly occurring in the Chinese offshore yuan forwards market where we're seeing a squeeze in USD/CNH as forward points jump up by the most in almost seven years.

And that is contributing to part of the dollar's weakness so far today. That aside, we're seeing a rebound in risk sentiment as European equities and US equity futures are trading higher. Metals are also showing a minor rebound on the day and that is helping to lift commodity currencies so far.

But despite all of that, the bounces are rather minimal and investors are not getting swept up by the optimism so far. And that goes to show the cautious and fragile tone that is still in place right now. All it takes is one negative headline or one bad tweet and all of this will start to turn around once again.

The yen is the weakest performing major currency on the day as a result of the improved risk sentiment while the dollar is also among the laggards. Meanwhile, the pound is feeling heavy and looks poised for further declines as even a more upbeat retail sales report is not helping to lift the mood.

And sitting firmly at the front is the aussie and kiwi as they benefit from better Chinese data and a more positive tone in the market.

Looking at individual currencies, EUR/USD started the session around 1.1370 levels before climbing to a high of 1.1398 but offers near the 1.1400 level kept price in check and the pair has now fallen back below the 100-hour MA to trade around 1.1360-70.

USD/JPY has had a more subdued session as the pair range-traded between 110.60-90 for the most part. Meanwhile, GBP/USD saw a move towards the week's high and traded to 1.2733 before falling to 1.2700 levels ahead of the retail sales report. The pair spiked to 1.2730 after but subsequently fell back to trade at the figure level as longer-term worries are still at play for the pound.

USD/CAD had a more subdued session after trading to session lows early on. The positive mood in markets is helping the loonie but the lack of any notable rebound in oil prices is making it difficult for the currency to see a major bounce of any sorts. The pair traded around 1.3120-35 for the majority of the session.

AUD/USD looks to be a lively pair on paper but ended up trading around 0.7250 to 0.7270 for the most part in European trading. The aussie continues to be supported by better risk sentiment and buyers appear to be forming a near-term base in the pair despite the fact that domestic bond yields are falling.


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Author: Eamonn Sheridan
1

Forex and Bitcoin news for Asia trading Wednesday 16 August  2018

China / US trade talks announced (read from the bottom up)

Other:

The news of the day is that a delegation from China led by China's Vice Commerce Minister Wang Shouwen is to head to the U.S. for trade talks in late August. Meeting with an American group led by David Malpass, under secretary of the Department of the Treasury.

Forex reaction was a pop for EUR/USD (along with AUD, NZD, GBP, CAD) and also for USD/JPY (ie a move by traders out of yen). The response was not huge, there were some stops to be triggered and that has seemed like it so far.  You'll recall a similar high-level meeting in May; the agreement from it was scuppered by the US President pretty much straight after, and the trade war escalated in June and since. It is perhaps (no perhaps about it) this memory which limited the positive vibe from the headline. 



Anyway, dialogue is a good sign so I think it is reasonable to expect some follow through as Europe comes in and responds. Are we out of the trade war woods yet? IMO no, but at least its something.

Equities responded with a cautious bid also.

Prior to this forex was subdued. USD/JPY had slipped a few points, as had yen crosses (EUR, AUD etc all a bit softer against the USD).

On the Australian dollar we got some data, the jobs report for July. The headline employment change was a bad miss, but otherwise details were more positive and the prior showed encouraging revisions.

The People's Bank of China set the reference rate for the onshore yuan weaker again today (ie higher USD/CNY), but with news of the trade talks the yuan has since gained a little.

Still to come:

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