Forex news for near trading on May 14, 2020 him him
- Major indices close at session highs
- WTI June crude oil futures settle at $27.56 a barrel
- New York coronavirus hospitalizations decline further
- Mexico's central bank cuts rates by 50 basis points to 5.5% from 6%
- WH trade advisor Navarro: Chinese government hackers trying to steal IP for vaccine
- Fed's Kashkari: V shape recovery is off the table
- Pres. Trump says: "Think we will have vaccine by end of year"
- US Senator Burr stepping down as chair of Intel committee
- Fed survey: 90% of workers who lost jobs were told they could return to their job
- European shares end the session with declines
- Fed's Bullard: Fed might forgo June forecasts
- Pres. Trump is open to a Phase 4 coronavirus stimulus bill, but....
- BOC Poloz: Strong financial system will help Canada emerge in good shape
- ECB's Villeroy: Yields and spreads do matter even if we don't target fixed levels
- German finance minister Sholz: Early June will announce stimulus package
- Canada March manufacturing sales -9.2% vs -4.5% expected
- US import price index for April -2.6% versus -3.2% estimate
- US initial jobless claims 2981K vs 2500K estimate
- The JPY is the strongest and the AUD is the weakest as NA traders enter for the day
A snapshot of other markets for the day is showing:
- Spot gold, plus $15.12 or 0.88% at $1731.36. The price moved above a topside trend line on the daily chart at $1722 area and that break triggered more buying in the precious metal. The high price extended up to $1736.55.
- WTI June crude oil futures rose by $2.45 19.69% to $27.74. The July contract also surged with a gain of $2.39 19.31% to $28.07
The big event today was the initial jobless claims. A total of 2.981 million more workers were added to the unemployment dole. Since mid March, 36.5 million Americans have lost their jobs. Continuing claims came in at 22.833 million. That was actually better-than-expected at 25.120K.
The data initially sent the US stocks to the downside. The major indices opened lower but traded in a very volatile up and down trading range for most of the trading day. However, the dips kept on getting bought and a late day rally helped to close each of the major indices higher, led by the Dow 30 which rose by 1.62% on the day..
The final numbers are showing:
- The S&P index, +32.5 points or 1.15% at 2852.50
- The NASDAQ index closed up 80.556 points or 0.91% at 8943.72
- the Dow industrial average rose 377.37 points or 1.62% at 23625.34
European indices did not benefit from the late day buying in the US market. All the major indices closed with sharp declines led by the UK FTSE which fell by -2.75%.
The US debt market saw yields move lower with the yield curve flattening. The 2 year yield fell by -0.8 basis points, but the 30 year bond fell by a greater -4.6 basis points.
The 2-10 year spread contracted to 47.56 basis points from 49.36 basis points at the end of trading yesterday.
In a Canada, Bank of Canada's Poloz - in one of his last duties as governor of the central bank - outlined the results of the financial system review. His comments were more upbeat than perhaps the market expected, and that helped to propel the CAD to the strongest of the major currencies today.
On the other extreme was the JPY. It was the weakest of the majors. The USD is sitting in the middle of the range with mixed results. The greenback rose versus the EUR, JPY and CHF, fell versus the CAD, AUD and NZD, and was unchanged versus the GBP.
Some technical comment heading into the new day:
- USDCAD: The loonie was not only the strongest (lower USDCAD), it is closing at the lows for the day. The price low has just reached the 1.4031 level. The level happens to be also where the 100 hour moving average rests. Just above that is the 50% retracement of the May trading range at 1.40355. Just above that level, since the pairs 200 hour moving average at 1.40384. In the new trading day, this area be between 1.4031 and 1.4038 will help define the bias going forward. Move below and the bias is more negative, move above and the bias tilts more to the upside
- EURUSD: The EURUSD had a up and down trading session in the NY trading hours. The early session low dipped below interim support at 1.0777 to 1.0771 but selling momentum could not be sustained. The rally back to the upside traded up to 1.0815 which is the top of a swing area between 1.0808 and 1.0815. The price then rotated back down toward the 1.0777 level only to find buyers once again. The pair is closing right around the 1.0800 level. So open them volatility with a wide range between 1.0777 and 1.0815. In the new day a break outside that range will help determine the next bias for the pair
- USDCHF: The USDCHF gave dip buyers a shot to buy low when it fell to test its 100 and 200 hour moving averages at 0.9712. Risk focused traders leaned against the two moving averages and push the price back higher. The pair is closing at 0.9732. In the new trading day, the moving averages remain the risk defining level for the pair. Stay above (they are currently around the 0.9714 level) and the buyers remain in control. Move below and sellers wrestle control back from the longs.
- USDJPY: The USDJPY traded between the 200 hour moving average below (currently at 106.79) and the 100 hour moving average above (currently at 107.158) in the New York morning session. In the New York afternoon, the price was able to extend above its 100 hour moving average and stay above. The high price extended to 107.36 before rotating back lower into the close. In the new trading day staying above its 100 hour MA will be the risk and bias defining level for traders. Stay above is more bullish. Move below is more bearish.
