Forex news for New York trading on Friday, November 11, 2016

  • S&P closes near highs but still down marginally on the day
  • Trump forms transition team with VP elect Pence as chair
  • US crude oil futures settle down on the day at $43.41
  • Copper retraces to week's midpoint
  • Baker Hughes oil rig count 452 vs 450 last week
  • DoubleLine Jeffrey Gundlach: Rate rise is about 80% on this move
  • US may start building the first wall against Mexico tonight
  • S&P affirms Italy's rating at BBB-
  • More twists and turns than Donald's hair in a gale but European stocks finish up for the week
  • We're thinking of the soldiers today
  • Technical analysis: Gold tumbles. Moves away from MA levels
  • Inflation expectations are not troublesome says Michigan's Curtin
  • November 2016 Michigan consumer sentiment flash 91.6 vs 87.5 exp
  • Copper and gold dropping. Sending commodity currencies lower
  • Fischer: Many Fed officials see the benefits of more fiscal policy
  • We need to teach Trump what Europe is, says Juncker. Can you help?
  • Fed's Fischer: Case is quite strong for the Fed to hike gradually
  • ECB's Lane: The ECB are in monitoring mode after Trump win
  • The strongest and weakest currencies as NA traders enter for the day

In other markets:

  • S&P index -0.14%,, NASDAQ composite index +0.54%, Dow industrial average +0.21%
  • US debt markets were closed in observance of Veterans Day
  • Spot gold $1225, down $-33 or -2.63%
  • Crude oil futures $43.20 $-1.46 or -3.27%
  • The strongest currency GBP. The weakest currency is the NZD today.
  • The USD was lower against the GBP and JPY and up against the EUR, CHF, CAD, AUD and NZD

And so ends the long anticipated US Election Week.

If you polled the market (and believed the polls), we would:

  • Have the first female President (Hillary Clinton).
  • Stocks would have been relieved that the Trump did not win
  • Bond yields would have probably moved higher in yields because the Fed would have likely tightened
  • We would be talking about the same things

Instead we get probably the most unlikely of Presidents elected in Donald Trump and with that we saw:

  • Stocks rally, but the rally occurring in the industrials. The high flying stocks like Facebook, Amazon, Netflix, Google were down.
  • Bond yield not only rose but soared on the idea that we will see the fiscal spigots opened, the deregulation of the the regulations, and tax cuts.
  • We saw gold tumble
  • We saw the US dollar rise but the GBP rise more as perhaps the countries that are changing become the rule (and the leaders) rather than the exception

It is only the first few days (and Trump is still 70 plus days away from taking office officially), but at very least (forget all the uncertainty that comes with a President Trump), it is refreshing to have change. "I wonder if the Fed is going to tighten?" is replaced by "What will he do next?". Already he has met with Obama and actually said he would keep some parts of Obama Care enacted, and softened the "I will send you to jail" rhetoric. Who would have thought.

Anyway, in the currency market today, the commodity currencies were more center stage. The NZD and the AUD fell - mainly on the back of a sharp fall in Gold and copper. Gold - lost lots of it's risk/fear attraction - when stocks started to rise, not fall, after Trumps election. Today, gold fell by 2.49%. Copper also tumbled and gave up nearly 50% of the weeks gains today.

The NZDUSD, already under pressure after the RBNZ rate cut this week, fell further. It also moved away from the 100 day MA (and other MAs) at the 0.7207 level. It is closing the day near the lows (at 0.7104) and also down 2.69% for the week.

The AUDUSD also fell (it was down -0.79% on the day) and is closing below it's 100 day MA (at 0.7588) for the first times since September 14th.

The USDJPY closed for the 2nd day above the 200 day MA at 106.53 (closed at 106.63). That is the bullish news. However, for the 2nd day in a row, the pair was not able to get above the 107.00 level. The gains for the week were maintained , however, with the pair trading at the highest level since July 21. Nevertheless, the market will be looking for a move away from the 200 day MA next week (that might be to the upside, OR it could mean a failure and move back lower for a corrective move).

The GBPUSD move higher and made new week highs in trading today (at 1.2673). That took the price above the high from the GBPUSD crash day on October 7th. However, the London/NY session saw some profit taking into the weekend, with the pair settling right around the 1.2600 level IN related pairs, the EURGBP traded above and below the 100 day MA at the 0.8615 level. The GBPJPY - which closed above the 100 day MA yesterday - moved up a little and will close the week above it's 100 day MA at 132.76.

The EURUSD was weaker in the NY session and moved below the October lows at 1.0850 and 1.0858 (it closed at 1.0851). The low reached 1.0830. Other support targets now come in at 1.0821 and 1.0777. A move below those levels will next target the low price for 2016 at 1.0710. That low occurred on the 2nd trading day of the calendar year.

Have a great weekend!