Forex news for NY trading on April 3, 2018

In other markets at the end of the trading day:

  • Spot gold is trading down $-9 or -0.67% at $1332.30
  • WTI crude oil futures trading of $.57 or 0.90% at $63.57
  • Bitcoin is trading up $94 at $7424. The 200 hour MA is at $7336 currently. The 30.2% retracement is up at $7490. A move above $7490, or below the 200 hour MA at $7336 will be eyed in the new day.

In the US debt market, the yields are higher:

  • 2 year 2.278%, +3.2 basis points
  • 5 year 2.597%, +5.0 baseboards
  • 10 year 2.778%, +4.9 basis points
  • 30 year 3.012%, +5.1 basis points.

The US stocks closed with solid gains:

  • S&P rose 1.26% at 2614.45
  • Nasdaq rose by 1.04% at 6941.28
  • Dow rose by 389.17 points or 1.65% at 24033.

The news was light in trading in the NY session.

Early on, US auto sales started to trickle in. Those sales ending being quite strong from March and should give a boost to 1Q GDP estimates going forward (and also for the consumer). The total vehicle sales came in at 17.4M annualized units, which was higher than the 16.9M estimate.

Also out today was the ISM NY index of business conditions which came in at 54.0 vs 54.5. There was little reaction to those releases.

Perhaps the biggest influences came from Washington. The first was on NAFTA. The President spoke about coming to a NAFTA agreement by sometime next week. That helped to send the CAD higher vs. all the major currency pairs The CAD was the strongest currency of the day. The USD fell by -0.84% vs the loonie. The biggest mover was the CADJPY which moved higher by 1.52% (see chart below).

The other development out of Washington came from more tweets on Amazon and the US Postal Service from Trump saying fees for mail would need to rise. That banter continued through most of the day and helped to keep the US equity markets contained. The S&P was trading near its 200 day MA (after closing below the level for the first time since June 2016 yesterday).

However, the in the late NY afternoon, a report that the White House had no plans for ongoing discussions on Amazon, sent their stock higher, and with it the rest of the market. Longs in the market were relieved. The price of the S&P closed back above the 200 day MA - leaving the potential that the low was in place and the break of the 200 day MA failed. Time will tell the story but for now, the longs have the upper hand again.

The impact on the USD?

The USDJPY ended the session more mixed with gains vs. the JPY, CHF, EUR, and losses vs. the CAD, NZD, AUD and GBP. So there was a flow into risk pairs (like USDCAD, AUDUSD and NZDUSD) and flows mainly out of the JPY.

Another development today was flows out of the EURGBP. That pair broke lower below its 50% retracement at 0.8730, and helped to keep pressure on the EURUSD and give support to the GBPUSD. The EURGBP fell from a high of 0.87.63 to a low of 0.8713 before rebounding back toward the 50% at 0.8730 (high correction reached 0.8729 in the NY afternoon).