Forex headlines for September 18, 2014:
- US initial jobless claims 280k vs 305k exp
- US August housing starts 956K vs 1037K expected
- Benchmark revisions add 7,000 more jobs to US payrolls
- SNB hasn’t excluded using negative rates says Jordan
- Jordan: SNB hasn’t intervened in past few weeks
- Moody’s to cut French rating to AA2 from AA1 on Friday: L’Opinion
- Hollande says ‘no idea’ whether France will be downgraded
- Latest Scottish poll has the No vote on 53%
- IMF sees risk of stagnation and low inflation in Italy
- South Africa leaves rates unchanged at 5.75%
- September 2014 UK CBI industrial trends orders -4 vs 9 exp
- Yellen says figures on poor Americans assets are sobering
- Tough to spin the low TLTRO takeup as good news
- US household net worth rose $1.39 trillion in Q2
- Five year Treasury yields at the highest since 2011
- US sells 10-year TIPS at 0.610% vs 0.570% WI bid
- Gold up $2 to $1226
- WTI crude down $1.41 to $93.02
- S&P 500 up 10 points to 2011
- CHF and GBP lead, USD and JPY lag
The US dollar mounted a fresh rally after the jobless claims data but it quickly faded. AUD/USD and USD/JPY moved to fresh cycle extremes but the excitement about the Fed meeting and dollar bull market then took a break with the Scottish referendum looming.
Cable was bid throughout the session and caught a quick bid as US traders rolled in. Stops were flushed on a rally up to 1.6409 as fast money makes big bets on a No vote. We’re expecting some major twists and turns in Asia-Pacific trading. There’s a bit of a wedge shaping up on the short-term chart so keep an eye on those parameters.
The general theme was a US dollar retracement (a minor one) but it didn’t apply to USD/JPY. A foray to 109.00 fell just short but the pair remains at 108.73 with bids at 108.50.
USD/CAD retested yesterday’s low of 103.28 but it held and the pair bounced up to 1.0960. That might be the final chapter, however, as the pair tests 1.0943.
Lots of eyes are on EUR/CHF with the pair down at 1.2067. The SNB was expected to introduce negative rates but it looks like they want to suck in some shorts and then burn them. Tread carefully around these levels but there’s no threat of the peg breaking unless something goes bonkers on a Yes vote later.
The Aussie is a basketcase but it’s made a bit of a stand above 0.8920 and is chopping around 0.8980.
