Forex news for FX trading on May 14, 2018
- US stocks end the session with modest gains. Rally attempt stalls.
- ECB Cœuré: Expect key policy rates remain at their present level for extended period of time
- More Ross: Hope we can make a fair deal with China
- Scottish Sturgeon: There is a real risk of a no deal Brexit that would be catastrophic
- Wilbur Ross: Not all trade deficits are the same
- WSJ: China and US working on a deal. ZTE Corp sanction reprieve for removing agricultural tariffs
- Incoming ECB member Rehn: Short term indicators suggests pace of growth has cooled
- EU major stock indices give up gains. End mostly lower
- More Bullard from NYC: Fed has taken steps to control inflation
- No top NAFTA meetings scheduled before Thursday 'deadline'
- Fed's Bullard says non-uniform currencies like crypto have failed in the past
- Canada April Teranet house price index +5.6% y/y vs 6.6% prior
- The GBP is the strongest while the NZD is the weakest as the NA week gets started
In the other markets today:
- Spot gold is trading down $4.75 or -0.36% at $1313. The price of gold followed the dollar. As the dollar rebounded the price of gold fell
- WTI crude oil is trading up $0.43 or 0.61% at $71.13. Crude oil is not ready to rotate too far from the high levels.
- Bitcoin on Coinbase is trading up $125 at $8837. The price has moved above the 100 day MA at $8820 toward the end of the day, and is giving traders some technical reasons to buy. The 200 hour MA at 8951 will be a key hurdle in the new day (see green line on the chart below).
- S&P rose 2.41 points or 0.09%. The Nasdaq rose 8.433 points or 0.11%. The Dow rose 68 points or 0.27%
- US yields were higher with the 2 year at 2.55%, up 1.2 bp. The 10 year at 3.00%, up 3.1 bps. The 30 year 3.13%, up 2.6 bp
The dollar weakened into the start of the NY session. It was not falling out of bed but was lower vs. most currency pairs with the exception of the JPY and the NZD. In fact, as London traders exited, the dollar was still lower vs all the major currencies with the exception of the JPY and the NZD.
Then the dollars fortunes started to turn more to the upside.
- St. Louis Fed's Bullard spoke perhaps a little less dovishly.
- Incoming ECB member Rehn spoke a little more dovishly.
- Wilbur Ross talked tough on trade, so perhaps there was a safety flow into the dollar as a result (just a guess).
- Maybe there is some concern about the key retail sales tomorrow. A stronger number could push the greenback to the upside.
- Technically, the declines of the greenback started to melt away.
For the EURUSD, the pair is trading at the end of the day down by a few pips and testing the 200 hour MA at 1.1927
The GBPUSD is still up by a few pips on the day (down -0.13% for the pair) and is testing a cluster of support at the 100 and 200 hour MA and the 200 day MA at 1.35489-543. That area will be a barometer for buyers and sellers in the new day.
The USDJPY remains above the 100 day MA and below the 200 day MA (at 108.46 and 110.15 respectively). In between is the 50% of the move down from the November 2017 high at 109.66. The pair is trading at 109.63 at the close.
The USDCHF retraced back to retest the key 200 hour MA at 1.0008 (and the key parity level). That is after testing a lower trend line at 0.9954
Below is the snapshot of the rank of the strongest to weakest of the major currencies. The GBP and the NZD were the strongest and weakest at the start of the day but the USD pushed the GBP at the end of the day. The changes for the greenback were not great, but compared to earlier levels today, the recovery was somewhat significant.
Retail sales tomorrow will be key.
