Forex headlines for October 6, 2014:
- September 2014 Canadian Ivey PMI 58.6 vs 53.0 exp.
- Canada confirms $5.15B budget deficit versus $16.6B govt forecast
- September 2014 US employment trends 121.68 vs 121.30 prior
- Glencore looking at Rio merger – Bloomberg
- Fed’s Dudley: I would be delighted to raise rates in 2015
- S&P 500 down 3 points to 1965
- Gold up $17 to $1208
- WTI crude oil up 0.83 to $93.13
- EUR leads, USD lags
News was on the light side so there was no great reason to dump US dollars but traders took a look at the upcoming calendar and didn’t find a reason to keep buying USD. So they began to sell and a trickle turned into a flood and as a series of squeezes hit in afternoon trading.
EUR/USD finally stalled at 1.2675 from as low as 1.2500 on Friday. USD/JPY slid down to 108.65 at the lows and there’s a potential double top near 1.10.
The Canadian dollar was the star performer after the budget data and upbeat Ivey PMI. You can question a market that rallies so much on such a bad indicator but it’s a sign of the skittishness in the market. Everyone is looking for news so anything — including tomorrow’s JOLTS report — could be big news.
Tally up Friday’s US dollar rally and today’s selloff and what’s left? I think that’s the way to look at it. Perhaps the dollar got a bit carried away on Friday and it went screeching down to earth but — excluding CAD — the US dollar is higher over the past two days.
US dollar two-day performance