Forex trading headlines from the European morning session 8 April
News:
- BOJ’s Kuroda sees no need to ease now judging from current economy
- BOJ’s Kuroda says recovery continuing even with sales tax hike
- BOJ’s Kuroda sees CPI around 1% for some time
- QE would be appropriate for euro area says Italy’s Padoan
- Growth deteriorating in emerging market economies says OECD
- Euro region not out of the woods yet says Schaeuble
- Outlook for German growth is positive says Schaeuble
- G20 communique to address problems in emerging economies
- UK’s Hague says they are “gravely concerned” by pro-Russian protester seizure of govt buildings
- Ukraine says 70 “separatists” arrested in Kharkiv
- Bank of France sees Q1 GDP growth at +0.2% q/q
Data:
- February UK industrial production 0.9% vs 0.3% exp m/m
- French trade deficit Feb EUR -3.4 bln vs -5.7 bln prev
- Swiss retail sales Feb y/y +1.0% vs -0.1% prev
- Swiss unemployment rate March unadj 3.3% vs 3.3% exp
- Japan economy watchers survey March 57.9 vs 53.0 prev
- Nikkei closes down 1.36% at 14,606.88
- Shanghai Composite Index closes up 1.92% at 2098.28
In a session that started off resigned to trading in ranges we’ve seen a combination of factors accelerate the USD selling.
First up was the falling Nikkei then suggestions again from BOJ’s Kuroda that he was in no rush to ease further and USDJPY was chewing through the bids at 102.75 to then test the next layer at 102.50. A further drop in Nikkei futures has been keeping the pair pinned to the lows.
EURUSD was edging higher to 1.3750 then popped through triggering stops to 1.3765 before GBPUSD then played catch-up and indeed overtook when it took out strong offers at 1.6650 and 1.6685 after stronger UK production data. High so far of 1.6717 driving EURGBP down to support around 0.8235 from 0.8265.
USDCHF was soon through support at 0.8870 and tested the next layer at 0.8850 before holding up but EURCH has been pinned around 1.2195.
AUDUSD and NZDUSD were meanwhile having their own rally with the former taking out the strong offers at 0.9310 triggering stops to 0.9228 initially before a further attack on the offers at 0.9350, but failing at 0.9341 and drifting back to 0.9321 as I type. NZDUSD similarly took out offers at 0.8650 to reach 0.8681 but has retreated to 0.8265 currently.
The loonie marches ever on taking out its second key level in as many days with 1.0950 popping to send USDCAD down to 1.0925 in a hurry where its wiped its feet since posting 1.0920 lows.
The danger of ranging markets is that the stops get bigger and therefore exacerbate the breakout and that, essentially, is what we’ve seen this morning. But there’s little sign of any retreat just yet.
