On the start of the fundamentally packed week, the greenback registered a negative closing as weaker manufacturing details coupled with the expectations of lesser ADP numbers, scheduled to release tomorrow, caused market players to liquidate some of their USD gains. The Euro region currency gained some grounds as ECB seems looking for economic overhaul to facilitate the QE rather than pumping the economy with extra money. The Japanese currency gain a bit even after witnessing a credit rating downgrade to A1 from Aa3 by the Moody’s as uncertainty on its plans to reduce deficit and boost growth can weaken the economic outlook of the nation. The GBP gained heavily after the Manufacturing PMI tested the highest level in last four months while the AUD remained stronger even after no change in RBA meeting and dovish comments as the central bank said the Japanese QE can support the economy while the improvements in Building Approvals remained strong.
During the early hours of the day, Australian release supported the Aussie and there are no important economics, except the UK Construction PMI, that can change the current market sentiment. However, one FOMC member, Lael Brainard, is scheduled to speak today and can cause considerable volatility into the market.
As the recent sentiment in the market has turned against the greenback with no economic readings supporting the currency, it would be better for the trader fraternity to wait till the weekend before taking any huge buying for the US Dollar. Should the ADP job number, scheduled for tomorrow, and the NFP, scheduled for Friday release, continue to signal weaker US Job market, the greenback can become liable to liquidate its profits.
On the second day of the crucial week, market changed its pattern and the US Dollar again became darling of the trader fraternity as FOMC officials, namely Fed Vice Chairman Stanley Fischer and New York Fed President William C. Dudley, in their public speeches stressed that the plunge in the oil prices is actually positive for the US and the officials, in the upcoming FOMC, on December 16-17, are likely to drop the word “considerable time” while discussing the timeframe for interest rate hike. The Euro region currency dropped as Euro-zone PPI plunged to the year’s low and market participants remained worried about the ECB’s next move ahead of the meeting scheduled for tomorrow. The UK Construction PMI plunged to the lowest since November 2013 causing damages to the GBP while the weaker Australian GDP number, at 0.3% against the prior of 0.5% and forecast of 0.7%, gifted a fresh four year low to the AUD. The NZD also declined after average price for whole milk powder at a Fonterra Cooperative Group Ltd. auction fell while the CAD and the CHF plunged considering the strength of the USD with no major economics to support.
During the early day releases, Australian GDP lagged behind consensus and previous while the Chinese numbers relating to service sectors remained a bit higher than their previous releases. PMI releases relating to the Services sector from the UK, US and the Europe are likely to be important for the rest of the day while the Us ADP number and the BoC meeting is expected to range to the day’s headlines.
As the ADP numbers forms expectations for the Friday’s NFP, a weaker release, as expected, can cause damages to the US Dollar strength while a number beating the prior release will be highest since July and is likely to provide considerable strength to the greenback. Moreover, the Canadian Dollar is expected to witness considerable movement as the BoC is more likely to signal weakness of the national economy due to plunge in oil prices. Hence, market players are advised to take the news seriously before deciding any trades.
Even after registering three month’s lowest level of ADP number, the US Dollar index yesterday secured another positive closing as ISM Non-Manufacturing Index signaled that the US service industry rallied by the second-fastest pace in nine years. Moreover, the Beige Book business survey said “that contacts remained optimistic about the outlook for future economic activity.” The Euro regional currency declined heavily as the composite plunged to the lowest in 16 months, paving way for the ECB President to signal sovereign bond buying in his press conference just after the meeting, scheduled to release today. The Australian currency plunged for the consecutive sixth day as Goldman Sachs Group Inc. said that the currency can test 79 level. The Japanese currency maintain its downtrend as various Japanese newspapers reported that the Prime Minister Shinzo Abe’s Liberal Democratic Party is likely to gain considerable majority at a Dec. 14 election, giving him an edge to maintain policies that have weakened the currency. The GBP gained against majority of its counterparts as the Services PMI beat forecast and previous releases. Moreover, the Canadian Dollar strengthened across the board as the Bank of Canada’s meeting revealed that the economy is on its way to desirable direction of higher export earnings and business investments.
During the early hours of the day, the Australian Retail Sales and Trade Balance surpassed forecasts. However, market players are likely to concentrate more on the ECB Press Conference, during the later hours. Moreover, the US Jobless Claims and the Canadian Ivey PMI data can continue building momentum for USD and CAD respectively.
Even if the ECB isn’t expected to take any action, ECB President, Mario Draghi’s, speech is more likely to fuel volatility into the markets as speculations remains strong about receiving signals for additional monetary easing measures. The BoE meeting is likely to remain as a non-event unless the central bank discusses anything important, which is highly unexpected. Market players are advised not to trade in a large number ahead of the ECB outcome as it is always generating huge volatility.
Against the popular perception, yesterday’s ECB meeting strengthened the regional currency as the central bank President, Mario Draghi said they need some time of analyze the economy before going for further monetary measures to fuel the troubled region. However, the language of the President signals that now the policy makers are sure that they have to introduce the QE against the uncertainty prevailed in the earlier meetings. The US Dollar remained lackluster with the Jobless Claims being somewhat higher than the forecast. Moreover, the Canadian Ivey PMI surpassed forecast and prior readings but the CAD failed to maintain the strength after BoC meeting. The JPY weakened to the lowest level in more than 7 years against its US counterpart with no major releases to support this continued declined of the JPY. The GBP remained weaker observing no change into the economics while the NZD and the CHF strengthened against the USD with AUD continued plunging across the board.
Early today, the Japanese Leading Indicator and the Australian AIG Construction Index plunged below their forecasts and previous readings; however, market focus is likely to remain centered on the US labor market numbers, scheduled for later today, in order to determine near-term US Dollar moves.
As far as the US NFP remains above 200K, which is more likely, the US Dollar isn’t expected to lose its near-term strength; however, a plunge below that level can provide considerable weakness to the greenback. Moreover, the Unemployment rate should also remained below 6.0% otherwise there can be weaker flows to the USD. Also, the US Trade Balance and the Canadian Labor market numbers are some other details that needs to be considered if the US labor market numbers fail to fuel the market volatility.
Last week, with heavy load of economic details, US Dollar registered considerable weekly gains as the labor market details remained upbeat. The NFP tested highest levels since June 2010 that provided strong support to the speculations that the FOMC, in its meeting on Dec -17, is likely to consider fueling their benchmark interest rate in near-future. The Euro region currency remained weak even if the ECB President asked for some time to analyze the economy before going for heavy QE as TLTRO results for the month of November are likely to signal weaker demand for the ECB’s funds. Canadian Employment numbers remained weak while the PMI releases from UK couldn’t help GBP to strengthen. The JPY continued trading weaker across the board and the AUD, NZD kept declining with their own fundamentals remained weaker than the US and the Chinese details started coming in lesser than expected.
During the early hours of today, Japanese Final GDP plunged to lesser than forecast and previous releases while the Chinese Trade Surplus couldn’t be positive as imports plunged heavily than the slower growth in exports signaling weaker days for the world’s largest industrial player. During the rest of the day, Swiss CPI & Retail Sales together with the Housing market numbers from Canada are likely to take the center stage of the economic calendar where there aren’t any major releases from the rest of the globe.
Moreover, the Ukrainian authorities are claiming a decline in rebel attacks in the eastern part as the two sides are near to an agreement to resume peace talks as soon as this week.
As the US Dollar registered considerably high job numbers, fueling the greenback, and pessimism continue to spread into the rest of the globe, higher are the chances that the USD can continue its upstream during this less eventful week. However, the consumer related details, Retails Sales and the Preliminary UoM Consumer Confidence, can become catalyst to determine near-term movement of the US Dollar.
Having registered considerable gains during last Friday, backed by excessively high NFP numbers, the US Dollar trimmed some of the gains on Monday as market players cashed some of the profits with no major important releases to track. The Euro region currency recovered from its lows while the GBP gained across the board as the BoE’s quarterly bulletin signaled the need of near-term interest rate hike which was well supported by the Bank of England policy maker, Martin Weale. The Japanese Yen also registered highest gain in seven weeks due to a pullback supported by the twice than the forecast of the current-account surplus. The Australian and New Zealand Dollar kept their decline running due to weaker Chinese numbers and the declining commodity prices while pessimistic Canadian housing market numbers caused weakness to the CAD. Moreover, the CHF registered gains even with the Retail Sales plunged to the lowest growth in last three months.
On Tuesday, the NAB Business Confidence from Australia registered its fourth decline to the lowest level since August 2013 and the Swiss Unemployment rate plunged to the lowest level since May 2013.UK Manufacturing and Industrial Production details are likely to take the center stage of the market today. Moreover, the Ukraine will observe a day of peace in the east today, ahead of new peace talks with pro-Russian separatists during this week.
After witnessing considerably high gains, the US Dollar liquidated some of its gains; however, it isn’t going to affect its longer-term bullish scenario and one shouldn’t be bear unless the fundamental details, Retail Sales and Consumer Sentiment Index, scheduled during the week, decline to the excessive lower levels which is highly unlikely.
Even with no voice from US economy, the US Dollar continued trading negative for the second day of the week as market players remained cautious ahead of the Consumer centric details on Thursday & Friday. The Euro region strengthened a bit even after fears emanating from Greece signaling a snap election as German trade data registered better than expected reading. The UK currency ignored the unexpected plunge into the Manufacturing Production while the AUD and NZD kept declining due to weaker Chinese numbers. The JPY continued its second day advance as pessimism at the global financial world continued supporting the safe haven demand of the currency that has declined too much. Moreover, the Gold prices rallied to the highest price since Oct. 23 as global markets remained fragile and Fitch rating services downgraded global growth.
Chinese inflation numbers, published early today, remained weaker than expected and caused considerable weakness to commodity currencies, especially AUD and NZD, and industrial world. The Japanese consumer confidence tested the lowest level since May 2014. For the rest of the day, the economic calendar seems on the silent mode for one more day with only French numbers awaited to be published.
As the recent rout of US Dollar selling continued to build market momentum, the traders are likely to continue on the short USD side with no major details to be published. However, this doesn’t term the USD move as a bear as important economic details are scheduled for release on Thursday and Friday. Moreover, should these details signal strength of the US economy, which is more likely, market players are likely to support USD strength ahead of the FOMC meeting scheduled for next week. Hence, market players are advised not to be USD Bear for more than 1 day unless the economic details register unexpected decline.
Forex market continued trading against the greenback for the third consecutive day on Wednesday as market players trimmed some of their greenback gains ahead of the Retail Sales, on Thursday and the UoM Consumer Sentiment Index, scheduled for Friday release. The Euro region currency kept ignoring the political crisis in Greece, that can caused the anti-bailout party to rule after December election. The GBP remained fragile in its trading with no economics left to publish while the AUD, CAD and NZD kept their decline intact concerned with weaker Chinese numbers.
However, volatility started taking place during the early hours of the day starting with RBNZ meeting that left its monetary policy unchanged, as expected. However, the speech by RBNZ Governor surprised market as it beat the dovish forecast and said the gradual rise in interest rate may continue to take place at a later start in 2015. Moreover, he also upgraded the economic growth forecast and said that the decline in milk prices hasn’t had affected the nation. After that, the Australian labor market numbers provided considerable strength to the AUD as the employment change tested the highest level in three months by beating the forecast.
During the rest of the day there are more numbers to roll out from economic calendars and majority of them are quite important. Amongst them, German Inflation number, TLTRO amount by ECB, US Retail Sales, SNB meeting together with the speech by BoC Governor becomes important for the forex market to track.
As the Forex economic calendar is filled with many important numbers today, the same is likely to provide considerable market moves; however, we could see the reversal into the ongoing US Dollar weakness provided the Retail Sales surpassed the previous number, as expected. Hence, it would become wise to support the USD today.
As expected, US Dollar regained its strength on Thursday after the economic details flashed positives. The Retail Sales rallied most in eight months while the Jobless Claims plunged to the lowest in three months signaling that the Fed will consider boosting its interest rate indicator. The Euro region continued declining as the political uncertainty over Greece was followed by the Italian President’s comments that he will also consider stepping down in the New Year. Moreover, the lower than expected TLTRO and the weaker French CPI provided additional weakness to the regional currency. The Japanese Yen maintained its plunge for the second day ahead of the snap election, scheduled for the December 14, signaled that the ruling party will gain heavy majority and the easy monetary policies will continue supporting weaker JPY. The NZD declined after witnessing a sharp up-move after the RBNZ as a plunge in Industrial numbers and a decline in milk prices continued hurting the currency. The AUD plunged to the four-year low after Reserve Bank Governor Glenn Stevens said that the currency will probably weaken next year as well. Moreover, the Canadian Dollar also weakened as the decline in crude prices coupled with the comments by the BoC Governor posed weaker Canadian economy and the weaker CAD.
The Ukraine continued witnessing the rebel attacks even during the truce day and the Ukrainian government urged international donors to help them. The Russian Ruble plunged heavily even after the Russia’s central bank increased its key interest-rate by 100 basis points to 10.5%. The Gold prices remained a bit weaker due to USD strength. Moreover, the Chinese Industrial Production grew with the slowest pace in three months while the Fixed asset investment matched forecast of the record low level.
For the rest of the day, US PPI and the Preliminary reading of UoM Consumer Sentiment are likely to remain highlighted and the USD is expected to continued its upward movement should these numbers continue depicting rosy picture of the US economy.
Even after registering gain on Friday, backed by improved Consumer Sentiment number, the US Dollar registered heavy losses on the weekly basis as market players remained wary of FOMC meeting, scheduled on December 17. Weaker crude oil prices and the decline in Chinese economic numbers continued hurting commodity currencies like, AUD, NZD and the CAD while the Problem at the Greece remained as a drag on Euro’s movement. The Yen gained after the Japanese PM won snap election on Sunday; however, it registered loses during early hours of the day due to Downbeat BOJ Tankan Report. The GBP also witnessed downside due to weaker Construction Output m/m.
Having witnessed the Japanese Tankan report during the early hours of the day and the Mid-year economic and Fiscal Outlook, market players are likely to concentrate on US Empire State Manufacturing Index, Industrial Production m/m and NAHB Housing Market Index for the rest of the day. However, major focus is likely to be centered on Wednesday’s FOMC release that will determine near-term US Dollar moves.
Considering the recent pullback of the USD ahead of the FOMC meeting and the continued improvement in US economic numbers, higher are the chances that the US Dollar is likely to gain heavily during the current week and market players are advised not to take trade against the USD strength unless the FOMC says something very pessimistic. It is not that the FOMC must convey their timing on interest rate hike to strengthen USD, the greenback can continue rallying should the economic projection continued building optimism.
The First day of economically packed week summed up with US Dollar registering minor losses ahead of the FOMC, starting today while rest of the currencies remained more on the downside due to weaker fundamentals. Yesterday, the US ISM Manufacturing plunged to -3.6, the lowest since November 2013, while the Industrial Production posted a strong gain of 1.3%. Moreover, the Russian Central Bank raised their benchmark interest rates for the sixth time in 2014, this time with heavy increase of 6.5% to the 17% level, after spending more than $80 billion from its reserves to defend the currency.
During the early hours of the day, RBA monetary policy meeting minutes continued stating that the Aussie is well ahead of its fundamental value and provided considerable decline into the AUD. Moreover, the HSBC Flash Manufacturing PMI for China plunged into the contraction region after witnessing five months of expansion state and caused weakness into the commodity currencies, AUD, NZD and CAD. The Gold prices plunged heavily after yesterday’s early strength of the USD triggered the break of important $1200 mark. Also, the decline in Crude Oil prices continued behaving as a strong negative reason for the commodity basket to register declines.
For the rest of the day, global economic calendar is packed with important fundamental readings, like BoE Stress Test Results, Manufacturing PMI releases from EU, UK CPI, German ZEW Economic Sentiment, Canadian Manufacturing Sales and the Us Housing Market details. Majority of these are signaling a plunge and can become negative for the respective currencies while the US Dollar is more likely to regain its strength ahead of the FOMC and backed by improved housing market numbers.
Second day of the week continued extending the US Dollar weakness as the greenback remained in a nervous state ahead of the FOMC decision, later today, while weaker housing market numbers supporting selling bets for the currency Improvement in EU PMIs coupled with the increase in safe haven demand, due to plunge in Rubble and the decline in commodity basket lead by Crude prices, continued strengthening rest of the currencies against the greenback. Moreover, some of the currencies, like GBP and NZD, maintained their gain even after witnessing weaker economic details as market players remained cautious ahead of the FOMC and avoided supporting the greenback buying.
However, yesterday’s positive trading couldn’t help the currencies to extend their up-move again USD during the early hours of the day as some of the economic details, like NZD Current Account and the Japanese Trade Balance flashed mixed signals.
Unlike rest of the weekdays, today’s economic calendar bears some of the important details, like EU Final CPI, UK Labor market numbers and the FOMC which are likely to become catalyst for near-term market movement. Should the EU Inflation plunges below its 0.3% Flash estimations and the UK labor market numbers coupled with the BoE Meeting minutes continue spreading pessimism, the gains earned by EURO and the GBP are likely to be liquidates quickly. Moreover, all eyes are likely to be centered on US FOMC and a small sign for near-term rate hike with the signal of timeframe can boost the US Dollar strength.
Hence, market players are advices to take their trading calls seriously before jumping on blind bets in today’s volatile market hours as important details can become harmful to their trading accounts.
With the much awaited FOMC meeting satiated market expectations by removing the pledge to keep borrowing costs low for a “considerable time”, the US Dollar reimbursed all the losses made during early week days. However, the FOMC statement wasn’t too optimistic as it continued supporting to be patient on the timing of the first interest-rate rate increase since 2006. The Fed Chair, Janet Yellen, also seemed more of the neutral by saying rates would probably be increased gradually once economic parameters were met. Moreover, the quarterly economic projections signaled lesser interest rate high as compared to the previous forecast and supported that the labor market will be heavily strengthened in the near-future. Market players eroded all the gains of GBP, EUR, JPY and rest of the majors earned during early day after the FOMC release. The GBP labor market numbers were quite optimistic while the Final version of the EU CPI matched its Flash estimation of 0.3%. Moreover, the US CPI plunged to the lowest since May 2013 by registering contraction of 0.3% and the Canadian Wholesale Sales m/m rose with the least pace in three months.
Having witnessed not so welcomed outcome of the major release, market players are not targeting other details scheduled during the week to determine near-term moves of the respective currencies. The New-Zealand GDP number surpassed its expectations and previous releases and strengthened the NZD during early hours of the day while the German Ifo Business Climate, UK Retail Sales, US Philly Fed Manufacturing Index and Unemployment Claims are the releases that will drive the market for the rest of the day.
Considering the recent FOMC announcement, and the unclear outcome, it would be better for the market players to wait for the clear indication ignoring the recent gains of the greenback. However, overall communication was positive and is likely to continue supporting the US Dollar growth. Hence, it would be better to support the longer-term buying for the USD, but with the correction being priced in.
On Thursday, weaker Manufacturing number couldn’t stop the greenback from registering a positive closing as Jobless claims improved and market players were quite optimistic after the FOMC removed the word “Considerable time” from its statement to signal interest rate hike. The Swiss Franc plunged heavily after the surprise action of SNB to introduce negative interest rates while the GBP climbed heavily after the Retail Sales noted considerable increase into the crucial part of the UK economy. The Ruble continue its decline as the Russian central bank announced various measures, after introducing surprise rate hike, to boost the economy. Further, increase in crude prices continued supporting the CAD while the Euro remained weaker even after the German Ifo number remained ahead of the previous release. The dollars of Australia and the New Zealand strengthened after China revised up the size of its economy. Moreover, the Japanese Yen continued trading weaker even after the central bank seemed more optimistic for their economy as the BoJ meeting, took place early in the morning, kept supporting the loose monetary policy.
After the BoJ monetary policy in the morning, there isn’t anything except GfK German Consumer Climate and the Canadian CPI & Retail Sales that can drive the market for the rest of the day. However, actions from Russia and the on-going EU Economic summit can give meaningful information to drive the markets.
As market players are now seem digested the FOMC indication and also supported the US Dollar, it would be better for the trader to support the USD buying ahead of the festive season. However, absence of market participants can cause undesirable moves and should be traded with strict stop-losses.
With the FOMC removing the word “Considerable Time” while conveying the time line for interest rate hike, the US Dollar registered heavy gains across the board during last week. The Euro remained weaker even with improved economic numbers as ECB Vice President, Vitor Constancio, told a German magazine that policy makers aren’t ruling out quantitative easing. The CAD remained troubled with weaker economics and declining crude prices while the CHF became victim of negative interest rate announcement by the SNB. Further, better UK Retail Sales number couldn’t help GBP from registering a negative weekly closing against USD while the AUD & the NZD kept their decline intact as pessimism over Chinese future growth hurt these commodity currencies. Moreover, plunge into the NZD Consumer confidence provided additional fuel to the NZD decline.
Peace talks in Ukraine remained ineffective and incidence of rebel attacks continue in some parts of the troubled nation. Today, the Ukrainian President, Petro Poroshenko, plans to hold talks with Kazakh President, Nursultan Nazarbayev.
Having witnessed considerable volatility during last week, backed by crucial events, current holiday shortened week offers fewer economic releases from the global world and is likely to become a supportive reason for the USD to maintain its strength. However, chances of the mild pullback can’t be denied should the final GDP numbers fail to maintain the optimism generated by initial forecasts. Moreover, the US Existing Home Sales and the European consumer confidence are important details scheduled for the today.
The gauge of dollar index (I.USDX) closed in the positive territory on the first day of this holiday shortened week even after the Existing Home Sales plunged to the weakest reading since May as Standard & Poor’s raised its forecast for the 2015 U.S. GDP. The rating agency raised its 2015 GDP forecast to 3.1% from 3%. The company kept its forecast for the Fed to raise borrowing costs in June, bringing the benchmark to as high as 1.25% by 2015 end. The yellow metal, gold, tested lowest level since the start of the month as rise in US Dollar coupled with the decline in Crude oil prices restricted the safe haven demand. The Euro region currency remained lower with consumer confidence continued remaining into the negative territory while rest of the majors extended their declines with no particular reason except weaker fundamentals at macro levels.
During the early hours of the day, the New Zealand Trade Balance registered least deficit in five months and provided minor strength to the NZD. Market players are likely to wait for the highest readings of the week, scheduled during the rest of the day, to determine near-term market movement.
As the Tuesday carrying heavy economic numbers, Canada, UK & US GDP remaining the biggest readings, higher volatility is likely to take place during the day. Moreover, the US New Home Sales, Durable Goods Orders and UK Current account details are some of the readings that can continue making traders busy throughout the day. The GDP numbers from US are likely to beat the previous forecast and can become important for the US Dollar up-move. Hence, it would b ebetter to stay long on the greenback.
Heavy weight economic numbers fuelled volatility into the forex market during the second day of the week; however US Dollar remained as a cleared gainer of the day as the Q3 2015 GDP tested highest level since Q3 2003, supporting speculations that the Federal Reserve can go for the interest rate hike during early 2015. The Euro region currency dropped again as the Greek PM failed to secure required voted in the second round of voting that could have help him pass this position to his selected successor. Should the same failure continue in the third (final) round of voting, snap elections can’t be denied. The GBP also lost heavily as the current account deficit widened and the yearly GDP was revised down to 2.6% from 3% ignoring the Q3 GDP numbers which matched forecast of 0.7% rise. The Yen also weakened against majority of counterparts as the market remained worried that the PM, Shinzo Abe’s, victory would fuel the economy more than expected. The AUD and the NZD continued remaining weaker with commodity basket kept their declines intact while the CAD also plunged even after registering higher forecast GDP number due to Crude oil downturn.
Having witnessed magnified data flow during Tuesday, economic calendar isn’t having anything to flash today except the weekly jobless claims by the US which is likely to remain near October lows and the can continue fueling the USD strength.
Hence, with no important economics to track and the upcoming holiday season, traders shouldn’t try to trade the market as sudden spikes can hurt their trading accounts. Rather enjoy the holiday season.
With holidays are on roll, disturbing the economic calendars and pumping the mood of celebrations, the globe seems to enjoy the end of 2014 with continuous push to the US Dollar which was the best gainer across the board. The zeal of optimism was bolstered by the improved GDP numbers that rallied heavily. Moreover, the Euro remained in trouble as Greek poling aren’t in favor of ruling party and can cause the snap elections in early February or late January if the current holder fails to gain enough of voting into the third round. Moreover, weaker Chinese numbers and the plunge in Crude prices continue hurting the commodity currencies, namely AUD, CAD and NZD.
For the day, market focus is likely to remain on third round of Greek elections as there isn’t anything left to be published during the current day. The economic calendar is also likely to remain silent most part of the holiday shortened week and the USD is likely to continue being a great winner.
Hence, it would be in favor of the traders’ fraternity to keep supporting the greenback; however, chances of a mild pullback can’t be denied during the less liquid days and that prevents market players from taking excessive positions.
Even with no major events on Monday, except the third round of Greek voting, the US Dollar continued registering its across the board strength as market players remained positive for the greenback which is all set to note its gains against all of its 31 major counterparts in 2014 for the first time since 1989. The Greek PMI failed to get enough parliamentary votes in favor during the third round of attempts to push his candidate Stavros Dimas, for head of state. Hence, the general elections can be held on Jan. 25 to select Greek PM. Should the anti-bailout party, Syriza, wins chances are higher that they won’t confirm the troika rules to confirm bailout package and can cause the economic tremor for the Euro-zone. The JPY continue trading down on the third day after the ruling party announced a 3.5 trillion yen ($29 billion) fiscal stimulus on Dec. 27. Moreover, the Abe’s party is also suggesting a cut into the corporate tax to support the domestic economics. The AUD, CAD & the NZD also declined with the Crude prices continue its plunge and the People’s Bank of China announced measures to support its banking structure.
Tuesday also becomes a day with lesser economics to track except the Spanish Flash CPI, European money supply and the US CB Consumer Confidence. However, the US detail of consumer sentiment is likely to dominate market readings and can cause the considerable USD moves. Hence, market players are advised to take their time from this holiday season and watch market moves in order to earn some quick benefits.
With all those good things from the US and the weakness of the Europe coupled with the Russian geo-political tensions, we come to the end of 2014 wherein the US Dollar was a clear winner against 31 of its counterparts, the best since 1989 with improved fundamental details. However, during the last days of the year, the greenback trimmed some of its gains due to lesser trader participation during holiday shortened week. Yesterday, with lesser than forecast CB Consumer Confidence, the US Dollar declined for the second consecutive day. The European currency extended its decline as the tensions over Greece snap elections kept hurting the regional currency while the AUD and NZD improved with the Chinese HSBC Final Manufacturing PMI being slightly higher than the forecast of 49.5. The JPY witnessed a positive day backed by higher safe haven demand and the BoJ’s decision to extend the maturities of their bond buying.
Having witnessed Chinese HSBC Manufacturing PMI data, during early today, US Jobless Claims, Chicago PMI and Pending Home Sales are likely to make traders busy during the last day of 2014. Moreover, tomorrow there will be holidays across the globe; hence, except Chinese Fnial Manufacturing PMI, there won’t be anything to observe on the first day of 2015.
As the greenback has gained considerable during the 2014 and with the higher number of economics than the other days of the week, it is likely to close with the positive day; however, chances of a heavy decline can’t be denied should the economic details plunge.
Have a great trading-day and the Happiest trading year ahead……