March 16,2016. The NZD is the strongest. The GBP is the weakest.
Big Day. No it is not Super Wednesday. It is FOMC Day. No change is expected in rates. Change in the tone is more expected. All eyes will be on the dot plot as well (3 more tightenings in 2016?). Of course, risk is increased. If you are in from yesterday (like Ryan) and you are in the black, you have a cushion in case of a surprise against your position. If you are not in the black, you are subject to the market risk (that is present all the time), event risk (that will be drawn out in varying degrees through Yellen's presser) and liquidity risk (again a drawn out risk through the entire show). That makes it more of a gamble.
So where do we stand right now?
The NZD is the strongest today. While the GBP is the weakest before the annual budget release (at 8:30 AM ET). Having said, that the divergence from strongest to weakest is not that great (see chart above).
The pairs - between now and then - will be jockeying around spurred by the flows and the data/events. In the US, CPI (-0.2% headline, +0.2% core), Industrial production (-0.2% est) and Cap. Utilization (76.9 est) , housing starts (est 1.15M) will be released at 8:30 AM and 9:15 AM (for IP and Cap utilization). Canada manufacturing sales (+0.5% est), and the UK budget will get going at 8:30 AM as well. So there is enough there to upset the apple cart.
Looking at the ranges and changes, of the majors, the GBPUSD is the farthest away from the close from yesterday. It has been going that way after falling below technical support areas yesterday. The EURUSD range is woefully small at 37 pips. Then again most are low. It is wait and see time.
The Dax is up the Eurostoxx are down (+0.34% and -0.37% respectively). Bond yields are a touch lower. WTI crude is up about 1.95% reversing the slide seen yesterday.
That is the state of affairs. Risky day. Drawn out day.
