Forex news for NY trading on September 27, 2016

  • Activity has slowed in the NY PM, so what can we look forward to?
  • Yen remains 'tricky' to trade - Goldman Sachs
  • US stocks maintaining gains...
  • Saudi oil minister says gap in views among OPEC countries is narrowing
  • USDJPY moves back in the red for the day
  • The words 'free trade' have been the greatest propaganda coup in a generation
  • Forex technical analysis: The EURGBP effect
  • Forex technical analysis: GBPUSD tests 100 hour MA again
  • France is bad but not as bad as Italy says French economic council
  • Fischer: The Fed contributed greatly to reducing recession's harm
  • Minor losses for European stocks at the close
  • Forex technical analysis: EURUSD tests 100 day MA...stalls
  • Where's oil going if we don't get any deals in Algeria?
  • BOJ sidelined unless USD/JPY falls below 95 - BNPP
  • Election makes US dollar vulnerable to the downside versus yen - BTMU
  • Whole lotta shakin goin on
  • What's in store for stocks after the Trumpton debate?
  • How long can the 100 level in USDJPY survive?
  • The strongest and weakest currencies as NA traders enter for the day

Data releases:

  • Sept Richmond Fed -8 vs -2 expected
  • September 2016 US consumer confidence 104.1 vs 99.0 exp
  • September 2016 US Markit services flash 51.9 vs 51.1 exp
  • July 2016 US Case Shiller 20 city HPI 0.0% vs 0.0% exp m/m SA

The day after the first debate, saw the US stock market move higher. Was it less fear from a protectionist President Trump (most saw Clinton winning) that had investors happy, or was it a rebound after 2 days of selling? US stock indices were higher by 0.6% to 0.9% on the day. In the US debt market, the yield curve flattened with the 2 year up a basis point while the 10 year was down about 2.5 basis points.

Fundamentally, the Case Schiller home prices were little changed, the Markit services PMI estimate was a bit better at 51.9 versus 51.1. The US consumer confidence also came in stronger at 104.1 versus 99 estimate, but the Richmond Fed index was weaker than expectations at -8 vs -2 est (last month it was worse however at -11 last month). So overall the data was mixed. Oil prices were lower on the day to $44.65 or down -2.79% on the back of speculation (and comments) that the OPEC meeting tomorrow would NOT lead to any cuts in production.

In currency markets, the NZD and the AUD were the strongest currencies of the day while the EUR was the weakest. The USD was mixed in trading with the pair up vs the EUR and the CHF, but down vs. the GBP, AUD and NZD. The dollar ended little changed vs the JPY and the CAD.

Most of the moves in the USD vs the AUD and the NZD occurred in the Far East session as traders reacted to risk on flows (on the back of Clinton's debate performance). In the NY session, the activity was more sideway/corrective.

For the EURUSD, the pair took a tumble early in the NY session. The fall took the price below MAs that extend currently from 1.1224 (where the 100 hour and 200 bar MA on the 4-hour is currently found) to 1.11867 (the 100 day MA. This will be a key level going forward). The low for the day for the EURUSD stalled 4 pips from the 100 day MA. Heading into the NY close, the price has moved up toward the higher MA levels near 1.1224. If the sellers today are excited about exploring the downside (once again), then this area against 1.1224 should provide a ceiling for traders to lean against. I would expect a move to and through the 100 day MA in the new trading day. If, on the other hand, the selling was just traders being traders with a push to the 100 day MA for trading sake (the EURUSD price action is not really trending of late), than a move above that ceiling will muddy the technical bias and likely lead to some additional buying in the new day.

The GBPUSD was more supported (bullish) in the NY session today. The price moved above the 100 hour MA in the NY afternoon session after using the MA as a ceiling in the Asian Pacific and NY morning session. That MA comes in at 1.3003 currently. It's proximity to the psychological 1.3000 level will make that area a bullish above/bearish below level in the new trading day. PS the EURGBP was influential in the EURUSD and the GBPUSD. It did hold support against a strong trend line on the 4-hour chart at the 0.8609 area. That trend line will be eyed going forward. For now, the line held with the EURGBP trading at 0.8623.

The USDJPY rallied in the Asian Pacific session, fell back lower in the London session and consolidated around the unchanged on the day (at 100.32) during the NY session. The low for the day, stretched to 100.07. The high moved above the 100 hour MA, but that failed (the 100 hour MA is at 100.65 currently). Over the last 7 or so trading days, the price has only closed above the 100 hour MA on 5 hourly bars. Sellers have been more in control. Looking further back, the price has not closed below the 100.00 level since August 18. Are we on the verge of a break one way or the other? Keep your eyes open.

Official closes for the stock market today:

  • S&P index +13.83 points or +0.64%
  • NASDAQ composite index +48.22 points or +0.92%
  • Dow industrial average +133.47 or 0.74%

Good fortune with your trading!