Author: FX
Share: EUR/GBP gains for four consecutive days, up 0.81% for the week, trading at 0.8635 but failing to break through the 100-day EMA at 0.8655. The Bank of England’s 25 bps rate hike influences the pair’s movement, capping further advance. Technical outlook reveals an inverted head-and-shoulders chart pattern, targeting 0.8900. EUR/GBP rallies for the fourth straight day, set to finish the week with gains of 0.81% but failed to crack the 100-day Exponential Moving Average (EMA) of 0.8655, tested on Thursday. The Bank of England’s (BoE) 25 bps rate hike was the reason that capped the EUR/GBP advance,…
Markets:Gold up $8 to $1941US 10-year yields down 14.5 bps to 4.04%WTI crude up $1.10 to $82.65EUR leads, CAD lagsS&P 500 down 24 points, or -0.5%The initial reaction to the non-farm payrolls report was to sell the dollar but then the market had a look at the higher wage data and there was a recovery. Ultimately though, a strong bid appeared for bonds and there was a growing sense that the Fed is probably done, something that Goldman Sachs reiterated in a note. Fed probabilities didn’t move much after the data but there’s only a 30% chance of another hike…
Just when we thought that a brand spankin’ new trading month would bring more asset-buying, high interest rate and global growth jitters dragged “risky” assets lower this week. That also meant that safe havens like USD and JPY dominated against their counterparts. So, what exactly happened? I can explain, but lemme show you the biggest headlines first: Notable News & Economic Updates: ? Broad Market Risk-on Arguments China’s official manufacturing PMI improved from 49.0 to 49.3 in July, while the services PMI dropped from 53.2 to 51.5 on lower construction activity China Caixin services PMI improved from 53.9 to 54.1…
SPX weeklyClosing changes:S&P 500 -0.5%DJIA -0.5%Nasdaq Comp -0.4% Russell 2000 -0.2%Toronto TSX Comp +0.5%On the week:S&P 500 -2.3%DJIA -0.5%Nasdaq Comp -2.8% Russell 2000 -1.2%Toronto TSX Comp -1.4%July was a great month for stocks but August has gotten off to a slow start. The market looked like it would turn today as yields fell but that ultimately wasn’t enough. US yields end the day 10-15 bps lower across the curve.Still, this is the first substantial weekly decline since March so the bulls can’t exactly complain. Source link
Bank of America (BofA) outlines three primary reasons why dips in the USDJPY exchange rate are likely to be both shallow and short-lived. Despite the Bank of Japan’s (BoJ) recent adjustments to its Yield Curve Control (YCC), BofA maintains its expectation for USDJPY to rise to 147 by September.Key Points:Unlikely Capital Repatriation: BofA does not foresee Japanese investors repatriating capital in the current fiscal year due to the recent YCC tweaks. This lack of repatriation is attributed to the preparation investors undertook last fiscal year in anticipation of BoJ’s policy normalization.No Indication of Multiple Rate Hikes: Despite the BoJ’s recent…
Share: Data released on Friday showed the Canadian economy lost 6,400 jobs in July, against consensus of a 21,100 increase. Analysts at CIBC point out there were further signs of loosening within the Canadian labour market in July, with a slight dip in employment contributing to another uptick in the unemployment rate.They warn that a reacceleration in wage growth may lead the Bank of Canada (BoC) to believe that labour market conditions haven’t loosened enough yet. Key quotes: “The reacceleration in wages and still low unemployment rate mean that today’s data are unlikely to convince the Bank of…
Share: GBP/JPY retreated towards the 181.00 area and cleared most of its weekly gains. Investors continue to digest BoE’s decision on Thursday. Governor Ueda committed that the BoJ will be more flexible with the 10-year JGB. On Friday, the JPY traded mixed against most of its rivals, mainly because of Governor Ueda’s from the Bank of Japan (BoJ) on widening the tolerance of the 10-year JGB. On the other hand, the GBP trades flat after the Bank of Englan monetary policy decision on Thursday. The GBP traded mixed agains most of its rivals following Thursday’s BoE decision. Overall,…
This bull market started with tech and it might die with tech.Amazon shares surged higher today on strong cloud revenue but Apple posted slowing sales, including of the iPhone and that has led to a heavy round of profit taking. Shares are down 4.6%.The entire summer run-up in Apple has now been erased and the fear is that we could get a deeper retracement, perhaps to the 38.2% or 50% levels of the one-way trade that started at the turn of the year. That would imply a further 7-12% decline.Apple daily chartHere is a sense of how revenues have trended…
It was a mixed week for our strategies as we took on a risk-on bias on the high probability we’d see further signs of a peak in the global rate hike cycle. But broad risk sentiment was net negative this week, and it wasn’t until we switched our stance that we saw a couple of arguably positive outcomes from Wednesday and Thursday discussions. EUR/AUD 30-min Forex Chart by TV On Monday, we decided to do work on EUR/AUD ahead of the fast approaching monetary policy statement from the Reserve Bank of Australia. Market expectations right before the release shifted hawkish…
The US dollar has recovered some of the selling after non-farm payrolls as equities give back gains. Notably, Treasury yields remain near the lows of the day, led by a 13 bps fall in 7-year notes.The dollar has been dragged around by fixed income this week but its stocks behind this move. The S&P 500 is now up just 4 points on the day at 4506 from a high of 4540.The dollar bounce is strongest against commodity currencies but the euro is starting to move as well.EURUSD 10 mins Source link