Forex news for NY trading January 29, 2018
- Stocks gets off to a bearish start in the new trading week
- Forex technical analysis: AUDUSD down on the day but still above key MA lines
- Economic calendar due from Asia today
- Crude oil futures settle at $65.56
- Fitch weighs in on implications of NAFTA on Mexico
- Bitcoin continues to waffle up and down in contained trading
- EURUSD: Flash HICP could cap gains but no catalyst for a meaningful retracement
- And more from US Lighthizer on NAFTA
- More from Freeland: There is a significant gap on a number of NAFTA issues
- More from Mexico's Guajardo: Mexico wants NAFTA deals without quotas/tariffs
- European stocks end session mostly lower
- Mexico' s Guarjardo: Will have substantial challenges next round. Lighthizer speaks as well.
- ECB officials are said to assume QE will end with short taper
- UK PM spokesman: There remains some distance between UK and EU
- EU's Barnier: EU cannot be sure UK can benefit from EU trade deals during transition
- Dallas Fed manufacturing activity index 33.4 versus 29.7 last month
- USDCAD keeps a lid on against its 100 hour MA
- UK' s Davis says he want minimalist customs agreement post-Brexit
- Atlanta Fed GDPNow starts 1Q growth estimate at a high 4.2%
- German government raises 2018 GDP forecast to +2.4% v 1.9% prev
- US December core PCE mm 0.2% vs 0.2% exp
- The USD is the strongest and the GBP is the weakest as the NA traders enter
In other markets, the snapshot shows:
- Spot gold down $9.60 -0.71% that 1340.09
- WTI crude oil futures are down $.65 or -0.98% to $65.49
- Bitcoin on Bitstamp is trading at $11,203, down $-572. The low reached $11,037 while the high extended to $11,820. The price is trading just below the 100 day moving average at $11,336. Activity was slow in the digital currency today (and over the last week or so of trading (see post here).
US rates in the US moved higher today.
- 2 year 2.116%, unchanged
- five-year 2.492%, +2.2 basis points
- 10 year, 2.697%, up 3.7 basis points
- 30 year 2.944%, up 3.3 basis points
US stocks today ended lower:
- S&P -0.67%
- NASDAQ -0.52%
- Dow -0.67%
The USD is ending the NY session and the day as the strongest currency of the day. This runs in contrast to the recent trends where the dollar has been sold. Higher interest rates and increased expectations that the Federal Reserve will signal more tightening in 2018 (above the 3 expected), helped to support the dollar. Gold and oil was lower helping to support the dolalr (or did gold/oil go lower because the dollar was higher). Finally, stocks fell. Stocks and the dollar has been inversely correlated of late. Today, stocks were lower, and the dollar went higher.
The economic new today saw personal income and spending came in a little better than expectations. Personal income was expected to rise by 0.3%. It rose by 0.4%. Personal spending was also expected rise by 0.4% and it did show that gain. However the prior month was revised higher to 0.8% from 0.6%. So overall better data. Core PCe came in as expected at 1.5% year on year.
In other data, the Dallas manufacturing activity index for January rose to 33.4 from 29.7. That was higher than the expectations of 25.4.
The Atlanta Fed came out with their 1st estimate of GDP for the 1st quarter and it was a good one at 4.2%. Of course, the estimate is more of a guess so early in the quarter. So I would not put too much faith in the number.
Nevertheless, the first cut of the 4Q GDP released on Friday showed a lower than expected GDP at 2.6% BUT inventories substracted -0.68% and net trade substracted over -1% from the number. If both those see a rebound, maybe the 1Q is well above trend. What we know is Trump is certainly intent on reversing the trend in the net trade and that is traditionally a drag on the US economy.
Although the dollar was higher today, the price action in the US session saw the greenback move up and back down.
The USDJPY got close to its 100 hour MA on the move higher (got within 6 pips of the MA line), but backed off into the close. The 100 hour MA is at 109.169. The current price is at 108.93. There is a trend line on the 5 minute chart that cuts across at 108.82. That might be the dividing line for bulls and bears in the new trading day.
The EURUSD fell to a low of 1.2336 and away from the 100 hour MA in the process. However, the rally back higher (lower dollar) saw the price move back toward the 100 hour MA at 1.2387. Stay below that MA keeps the sellers content. Move above and the idea of a lower EURUSD (after going 1000 pips higher since November), may not be the trade.... yet.
The GBPUSD fell to within a few pips of its 200 hour MA at 1.40206 (the low reached 1.4024). The inability to break below that MA, helped to give the pair a boost in the NY afternoon session. The price moved up[ toward the swing low from last Thursday at 1.40814, but stalled ahead of that level. If the price is going lower, the 200 hour MA needs to ultimately be busted (it is at 1.4029 and moving higher). If it is going higher, getting back above 1.4100 will be eyed.
The USDCAD remains below its 100 hour MA at 1.23438 (it trades at 1.2335). Stay below is more bearish. Move above is more bullish.
The AUDUSD remains above its 100 hour MA at 0.80695 (and moving higher). Move below that MA and the 200 hour MA will be another hurdle at 0.80318 (and moving higher). The last 4 tests of the 200 hour MA stalled the fall.
