Forex news for NY trading on December 17, 2019
- Major indices close at record levels again
- Crude oil settle at $60.94. Stays above $60 today.
- Trump sends letter to Pelosi criticizing impeachment process
- Bitcoin is down again today, but the low did stall against a lower channel trendline. It gives the buyers some hope
- House passes funding bills that would avert government shutdown
- Fed's Rosengren (non-voter in 2020): Don't need more easing unless the material change
- European shares end the day with mixed results
- Atlanta Fed GDP now estimate comes in at 2.3%. Up from 2.0%
- Global dairy trade results show a -5.1% decline in the price index
- Pres. Trump encourages the Fed to act (again)
- More Kaplan: Sees consumer being solid next year
- Jolts job openings 7.267 million versus 7.018 million estimate
- Fed's Kaplan: Would take material change in econ. outlook to support a rate change
- US industrial production for November 1.1% versus 0.8% estimate
- Lighthizer: US-UK trade deal is a priority
- US housing starts for the month of November 1365K versus 1345K estimate
- Canada October manufacturing sales -0.7% vs 0.0% expected
- Fed's Kaplan: We're at or past full employment, not much slack is left
- The EUR is the strongest and the GBP is the weakest as NA traders enter for the day
In other markets,
- Spot gold is trading near unchanged levels at $1476.18. The high price reached $1480.58. The low extended to $1474.26
- WTI crude oil futures extended to the highest level since September 17. The price is currently trading at $60.87, up $0.66 or 1.10%. The high for the day reach $61.06. The low extended to $60.03
For the 4th day in a row, the S&P index and NASDAQ index closed at record high levels. Admittedly the changes today were somewhat minimal.
- The S&P index rose 1.07 points or 0.03% to 3192.52. The hi reached 3198.22. The low extended to 3191.03
- The NASDAQ index rose 9.131 points or 0.10% to 8823.35. The high reached 8833.99. The low extended to 8804.598
- The Dow rose 31.27 points or 0.11% to 28267.18. The high extended to 28328.63. The low reached 28220.56
Today was all about the GBP. The pound got walloped on the day with declines of over 1% against all the major currencies. The GBPs worst performers were against the CHF (-1.71%), EUR (-1.59%) and the USD and JPY (both -1.53%). Those are big moves for the day.
The catalyst?
There was a report that Prime MinisterBoris Johnson will add a revision to the Brexit deal that would explicitly rule out any extension to the transition period beyond December 2020. The UK is scheduled to leave the EU on January 31, 2021. The markets are concerned that that would potentially lead to a no Brexit if there is no agreement by then. EU's chief Brexit negotiator Michel Barnier said last week that striking a "comprehensive" free-trade deal between the EU and UK in 11 months next year will be impossible.
In the US news today housing starts and building permits were better than expectations. Recall that the private NAHB index rose to the highest level since 1999 yesterday. Today's housing and permits report support build his confidence in the housing market .
Also released today was the JOLTS job openings rose, which supports the strong jobs environment.
Fed speakers are back with both Fed's Rosengren and Feds Kaplan saying no changes in rates were needed unless there is a material change in the economy. Pres. Trump disagrees with that assessment as he once again tweeted his support for an easier Fed.
Looking at the rankings of the major currencies, the CHF was the strongest currency, while the GBP was the runaway weakest currency (the cumulative changes versus major currencies was -10%). The US dollar was mostly stronger with little changes versus the EUR, JPY and CAD. The pair soared versus the GBP and rose verse the AUD and CHF as well (see chart below).
Some technical levels to high into the new day:
- GBPUSD. The GBPUSD fell to support at the 1.30998 to 1.3111 swing area. The lof ro the day reached 1.3100. If the price can stay above the 1.3100 level, there could be a rotation back to the upside. The low price just before the 1st exit poll from last Thursday's UK election was at 1.31388. A move above that level may solicit some additional buying interest. A move below the 1.3100 level would have traders looking toward last week's low at 1.30494.
- EURUSD: The EURUSD trade above and below its 200 day moving average at 1.11503 during most of the New York session. The price is trading just below that level I.1147 and just above its 100 hour moving average at 1.11425. With the price currently trading between those 2 moving average levels, a break and momentum in the direction of the break, would tilt the bias in that direction.
- USDJPY. Trading in the USDJPY took the day off. The low to high trading range for the day was only 19 pips. There was a ceiling at the 109.63 area. Get above that level and the high from last week at 109.70 and the high from December 2 at 109.72, would open the door for further upside momentum. ON the downside the rising 100 hour moving average at 109.29 will be a key support target. Break below and selling should intensify.
- AUDUSD. The AUDUSD in the London session fell below its 200 hour moving average at 0.68555 and stay below that moving average. The problem is that the low price for the day could only reached down to 0.68377. Nevertheless if the price can remain below the 200 hour moving average, look for further downside momentum.
Wishing all good fortune in your trading in the new trading day.
