Forex news for Asia-Pacific session on November 1, 2018

Intro Paragraph Text Here.

Markets:

  • Spot gold is up $2.95 or 0.24% at $1217.72. The lower dollar is helping to push the price of gold higher
  • WTI crude oil down -$0.36 or -0.57% at $64.95
  • Nikkei 225 is down -200 points or -0.93% at 21715
  • Shanghai composite is up 29 points or 1.13% at 2632
  • S&P futures are up 10.3 points
  • Dow futures are up 73 points
  • The NZD and AUD are the strongest. The USD is the weakest.

At this time yesterday, the USD was the strongest and the AUD was the weakest. Today the NZD and AUD are the strongest, and the USD is the weakest. Turn the beat around.

The move higher in the USD yesterday took the dollar index (DXY) to the high for the year (see post here) - rising above August highs. Today the early trading in the day, have taken the price of the DXY back below the August high.

Failed break? Do we start to see the dollar buyers turn around on the failure?

It will be interesting to see what happens in the London session. What might make it difficult is Friday is US employment day. Remember, the ADP data released yesterday in the NY session, suggested yet another strong jobs number on Friday. That will keep the Fed talking about hikes, no matter what stocks do.

For the Asia-Pacific session, the focus was not on the USD/Fed, but instead on the news out of the UK and Australia.

Regarding the UK, there was a report that PM May reached a deal with the EU on financial services. That news helped to rally the GBPUSD and GBP pairs. The price of the GBPUSD moved from 1.2764 to 1.2855. The move sent the pair close to the key 200 hour MA at 1.2866. The price of the GBPUSD has not moved above the 200 hour MA since October 17th. A test in the new day will be a key barometer for bulls and bears. Move above opens the door for a move toward 1.2900. Stay below, and the the pair may ping pong between the 100 hour MA at 1.2785 and the 200 hour MA at 1.2866 until employment Friday (PS BOE decision will be announced later today but no change is expected).

The EURUSD was dragged higher in sympathy (or so it seemed). The gains were more modest, but with the pair touching the August low at 1.1301 yesterday (so double bottom now), the higher the price goes, the more traders start to think the double bottom is indeed a bottom worthy of more upside potential. Technically, the pair has some more proving to do. Currently the price is testing a trend line on the hourly chart at 1.1344. Above is the 100 hour MA at 1.13622. On Monday, the price of the EURUSD moved above that MA, but the break higher ran out of momentum and rotated back lower. A 2nd break is needed to get the "double-bottom" bottom chatter resonating louder in the market.

The AUD was pushed higher when the trade data showed a surplus of A$3017M vs A$1700M expected. That sent the AUDUSD from 0.7079 to a high of 0.7133 (just reached in the current hourly bar)> The pair is trading at the highest level since October 19 (at 0.7129 currently). More momentum today would target the 0.7151 area (near highs from October 16, October 18 and October 19).

Another big mover in the early hours of the new day, is the NZDUSD. It - like the EURUSD - piggybacked on the AUDUSD strength. Technically, yesterday the pair moved below the 100 hour MA in the NY afternoon. That turned the bias more negative (the 100 hour MA is at 0.6531 currently). When today, that MA as broken to the upside and then the 200 hour MA was broken (at 0.6538), sellers turned back to buyers and the price shot higher. The price is trading at new session highs as I type at 0.6583. It also move above the 0.6567-72 swing area that stalled rallies on Oct 23, Oct 24, Oct 30 and Oct 31. That area is now the new risk for the longs for the day.

Below is a snapshot of the % changes of the major pairs.

That does it for me. Wishing you all good fortune in your trading.