Forex trading headlines for October 30, 2013:
- No taper from the Fed
- No changes to Fed language on asset purchases
- Slight downgrades on economy from Fed, especially housing
- RBNZ says rate increases likely needed in 2014
- US ADP national employment change Oct: +130k vs +150k exp
- US core CPI sept s/a: m/m +0.1%% vs +0.2% exp
- German prelim HICP oct: y/y +1.3% vs +1.5% exp
- New ECB LTRO baked in say economists
- Conference Board’s Help Wanted OnLine data showed job ads down 258K in October
- VIX posts biggest drop in 5 years then gets done by a fat finger
- BOJ expected to maintain inflation target – Nikkei
- S&P 500 down 0.5% to 1763
- Gold flat at $1344
- WTI crude down $1.48 to $96.72/barrel
- NZD leads, JPY lags
USD/JPY hit buy stops above 98.50 after the Fed decision but stalled at 98.68, ahead of offers at 98.80. In the hours leading up to the decision the pair was very quiet except for a small kneejerk lower minutes before the release.
EUR/USD got caught leaning the wrong way into the decision as it briefly jumped before the headlines and then dropped below 1.3700 from 1.3770 prior to the decision but didn’t hit stops below 1.3690. Technical support caught the fall and it has bounced back to 1.3737 as the market digests the Fed.
Cable also dropped about 70 pips on the Fed decision, hitting 1.5999 as dip buyers waited for the big figure to crack before wading in. Bids remain at 1.5980 and 1.5950 and the pair bounce to 1.6040.
