Daily Market Outlook by Kate Curtis from Trader's Way

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989

Forex Major Currencies Outlook (Aug 01, 2017)

USD

The Greenback was under pressure due to internal chaos in the White House and brewing tensions with North Korea. According to two intelligence officials, the latest successful ICBM test signals that the hermit nation could hit most of the US. Data was mixed, with the Chicago PMI posting a larger than expected drop to 58.9 and pending home sales showing a 1.5% rebound. Personal spending and income, along with the core PCE price index, are lined up next.

EUR

The euro continued to advance against most of its peers when the core CPI flash estimate printed stronger than expected results. The headline reading was unchanged at 1.3% as expected but the core version rose from 1.1% to 1.2%. German retail sales also beat expectations with a 1.1% jump versus the 0.1% estimate. Final manufacturing PMIs from its top economies and the euro zone’s flash GDP reading are due today.

GBP

The pound is holding steady leading up to the release of June PMI readings and the BOE decision. Data turned out stronger than expected yesterday as net lending to individuals rose to 5.6 billion GBP while mortgage approvals held steady at 65K. Nationwide HPI is due today, along with the manufacturing PMI which could recover from 54.3 to 54.4.

CHF

The franc kept tumbling against its peers as pairs have been breaking technical levels and drawing more sellers in. There were no reports out of the Swiss economy yesterday but the monetary policy divergence with the ECB is probably keeping franc bears in the game. Swiss banks are closed for the holiday today.

JPY

The Japanese yen had a mixed run as it mostly reacted to currency-specific events. The safe-haven currency appears to be regaining its lost ground to the dollar as the latter faces falling bond yields on the chaos in Washington. The final manufacturing PMI was downgraded slightly from 52.2 to 52.1.

Commodity Currencies (AUD, NZD, CAD)

The Loonie was unable to hold on to its gains even though crude oil ticked higher. Underlying inflation data from Canada printed downbeat results, dashing hopes of another BOC hike in the near future. RMPI fell 3.7% versus the projected 3.2% fall while the IPPI slipped by 1.0%. The RBA decision is due next and no changes to the 1.50% benchmark rate is eyed as the central bank might issue a neutral statement.

By Kate Curtis from Trader’s Way

990

Forex Major Currencies Outlook (Aug 02, 2017)

USD

The dollar recovered slightly against its peers when a bit of risk aversion returned to the markets and US data came in mostly in line with estimates. The core PCE price index posted another 0.1% as expected while personal spending ticked up by 0.1% as well, even while personal income was flat. The ISM manufacturing PMI slipped from 57.8 to 56.3, slightly lower than the 56.4 estimate. The ADP report is due next and a 187K gain in hiring is eyed.

EUR

The euro was off to a good start as European stocks rallied on the region’s flash GDP report. However, the shared currency retreated when the German bond auction resulted to lower yields. The German unemployment change report showed a larger 9K drop in joblessness while the region’s GDP showed a 0.6% expansion. The Spanish unemployment change report is due next.

GBP

The pound was able to hold its ground thanks to upbeat manufacturing PMI. The reading recovered from 54.2 to 55.1, outpacing the consensus at 54.4. The construction PMI is due next and a dip from 54.8 to 54.3 is eyed but another stronger than expected read could mean more pound gains ahead of the BOE decision later this week.

CHF

The franc was still in a weak spot but managed to recoup its losses when risk aversion returned. There were no major reports out of the Swiss economy then while today has retail sales, manufacturing PMI, and the SECO consumer climate index. Retail sales are expected to recover by 1.3% while the manufacturing PMI could fall from 60.1 to 58.9. The SECO index is projected to climb from -8 to -3.

JPY

The yen had a mixed performance as it reacted mostly to currency-specific events rather than establishing its own direction. The BOJ core CPI held steady at 0.3% instead of dipping to the projected 0.2% figure and the consumer confidence index is due today. Analysts are expecting to seen an improvement from 43.3 to 43.5.

Commodity Currencies (AUD, NZD, CAD)

The comdolls returned some of their gains as crude oil and dairy prices dipped. The API reported a surprise build in stockpiles while the GDT auction showed a 1.6% drop in dairy prices. New Zealand also reported a surprise 0.2% drop in hiring for Q2 but the unemployment rate improved from 4.9% to 4.8%. The RBA kept rates unchanged at 1.50% as expected while issuing a relatively neutral statement.

By Kate Curtis from Trader’s Way

991

Forex Major Currencies Outlook (Aug 03, 2017)

USD

The US dollar had a mixed run as it reacted mostly to currency-specific data and was tossed around by Fed commentary. A couple of Fed officials warned that weak inflation should keep gradual tightening in place while Bullard emphasized that the balance sheet runoff should start this fall. The ADP report showed a weaker than expected 178K gain in hiring versus the projected 187K figure but the previous reading saw a large upgrade from 159K to 191K. Challenger job cuts and the ISM non-manufacturing PMI are due today.

EUR

The euro carried on with its climb to the dollar but at a slower pace. The Spanish unemployment change report showed a smaller than expected 26.9K drop in joblessness versus the projected 66.5K drop and the earlier 98.3K reduction. Final services PMI readings are due today, along with the region’s retail sales figure.

GBP

The pound struggled to hold its ground after the UK construction PMI posted a steeper than expected fall from 54.8 to 51.9. The BOE is set to make their policy statement today and also release its MPC meeting minutes. Three members voted for a hike in the previous meeting so traders are eager to find out if this hawkish bias is sustained. The BOE Inflation Report and UK services PMI are also lined up.

CHF

The franc had a mixed run but was mostly in a weak spot against its counterparts. The SECO consumer climate index improved from -8 to -3 while Swiss retail sales posted a stronger than expected 1.5% year-over-year rebound. The manufacturing PMI was also stronger than expected as it rose from 60.1 to 60.9 instead of falling to 58.9. There are no reports due from the Swiss economy today.

JPY

The yen also had a mixed round as it reacted to market sentiment and currency-specific factors. There were no reports out of Japan then and none are due today so global bond yields and overall risk sentiment could continue pushing yen pairs around.

Commodity Currencies (AUD, NZD, CAD)

The EIA reported a draw of 1.5 million barrels in crude oil stockpiles, smaller than the estimated reduction of 3.2 million barrels but a draw nonetheless. Comdolls were a bit weaker for the day as risk aversion was in play for the most part. Earlier today, Australia reported a weaker than expected trade surplus of 0.86 billion AUD.

By Kate Curtis from Trader’s Way

992

Forex Major Currencies Outlook (Aug 04, 2017)

USD

The US dollar had a mixed run as it reacted to currency-specific events. Traders seemed hesitant to take large positions ahead of the NFP release since leading indicators have been hinting at a slowdown in hiring. The ISM non-manufacturing PMI fell from 57.4 to 53.9 while the Challenger job cuts report showed a larger 37.6% drop in layoffs. Analysts are expecting to see a 181K increase in hiring for July, enough to bring the jobless rate down from 4.4% to 4.3%. Average hourly earnings could post a stronger 0.3% uptick.

EUR

The euro continued its rally against most of its counterparts even as final services PMI readings turned out mixed. The readings from Spain and Germany saw downgrades while Italy reported an upgrade. German factory orders, Italian retail sales, and the region’s retail PMI are due next.

GBP

The pound suffered a sharp selloff after the BOE statement as fewer policymakers voted to hike rates compared to last time, signaling a shift to a less hawkish bias. The central bank also downgraded its growth forecast while maintaining its positive outlook on inflation. There are no reports due from the UK economy today.

CHF

The franc was still in a weak spot against most of its counterparts, mostly due to the SNB’s dovish stance and the threat of central bank intervention. There were no reports out of the Swiss economy yesterday and none are due today so market sentiment and SNB expectations could stay in play.

JPY

The Japanese yen was able to take advantage of dollar weakness and risk aversion even as Japanese average cash earnings data printed a weaker than expected 0.4% drop versus the projected 0.5% gain. There are no other reports due from Japan for the rest of the day so yen pairs could take their cues from bond yields and the NFP release.

Commodity Currencies (AUD, NZD, CAD)

Risk-off flows dampened gains for the commodity currencies as shifting policy biases weighed on sentiment. Australia reported a smaller than expected trade surplus of 0.86 billion AUD compared to the estimated 1.78 billion AUD figure while previous reading was downgraded. Earlier today, Australian retail sales beat expectations with a 0.3% gain. Canada will release its jobs report next and might show weaker hiring growth of 11.7K compared to the previous 45.3K increase.

By Kate Curtis from Trader’s Way

993

Forex Major Currencies Outlook (August 7, 2017)

USD

The US dollar got a boost upon seeing stronger than expected July NFP data. The economy added 209K jobs during the month versus the estimated 187K gain while the June reading enjoyed an upgrade to 231K. Average hourly earnings came in line with expectations of a 0.3% uptick while the jobless rate dipped to 4.3% as expected. Only the Fed labor market conditions index is due today, along with a speech by dovish FOMC member Kashkari.

EUR

The euro returned some of its gains to its peers on profit-taking at the end of the week. Data from the euro zone was actually better than expected as German factory orders surged 1.0% versus the projected 0.6% increase while Italian retail sales printed a higher than expected 0.6% increase. German industrial production data and the region’s Sentix investor confidence index are lined up next.

GBP

The pound held its ground against some of its rivals at the end of the week as traders booked profits off their post-BOE short positions. There were no major reports out of the UK economy on Friday and today has the Halifax HPI lined up. Analysts are expecting to see a 0.3% rebound in house prices.

CHF

The franc had a mixed run as it mostly reacted to currency-specific factors. There were no reports out of the Swiss economy on Friday while today has the SNB foreign currency reserves data due. An increase from the earlier 693B CHF reading could be evidence of central bank intervention. The CPI is also lined up and a 0.3% drop in price levels is eyed.

JPY

The yen gave up some ground to its peers when US bond yields ticked higher after the NFP release. Data from Japan was also weaker than expected then as average cash earnings fell 0.4% versus the estimated 0.5% gain. Leading indicators data is due next and an improvement from 104.6% to 106.2% is expected.

Commodity Currencies (AUD, NZD, CAD)

The comdolls returned some of their recent gains to the dollar on Friday. Canada reported a 10.9K gain in hiring versus the projected 13.1K increase and the earlier 45.3K jump. Their unemployment rate fell from 6.5% to 6.3% on weaker labor force participation while the trade balance also disappointed. The Ivey PMI, on the other hand, printed a smaller dip from 61.6 to 60.0 versus the projected 59.2 reading.

By Kate Curtis from Trader’s Way

994

Forex Major Currencies Outlook (Aug 08, 2017)

USD

The US dollar was off to a slow start for the week as there were no major reports released. Two Fed officials shared their thoughts on future policy moves, with both Kashkari and Bullard urging to start the balance sheet runoff soon since this won’t harm the markets. US consumer credit shrank from $18.3 billion to $12.4 billion. The NFIB small business index is due, along with the JOLTS job openings data and IBD/TIPP Economic Optimism index.

EUR

The euro retreated against most of its counterparts as traders started having doubts on ECB tapering. German industrial production was weaker than expected with a 1.1% fall versus the projected 0.2% uptick. German and French trade balance are due next and upbeat results could lift the shared currency once more.

GBP

The pound was still on weak footing as traders continued adjusting their portfolios to the less hawkish BOE bias and Brexit concerns. The Halifax HPI posted a larger than expected 0.4% gain versus the projected 0.3% uptick. There are no reports due from the UK economy today.

CHF

The franc also tumbled to most of its peers as the SNB foreign currency reserves figure grew from 694 billion CHF to 714 billion CHF, hinting that the central bank may be increasing its forex holdings to keep the franc weak. Swiss CPI posted the estimated 0.3% drop in price levels, following the earlier 0.1% downtick. Swiss jobless rate is due today and no changes from the earlier 3.2% reading is expected.

JPY

The yen regained some ground to its peers as tensions with North Korea drove demand for safe-havens. Japan’s leading indicators improved from 104.6% to 106.3%, slightly higher than the 106.2% consensus. The country’s current account surplus also widened from 1.40T JPY to 1.52T JPY. The Economy Watchers Sentiment index is due next.

Commodity Currencies (AUD, NZD, CAD)

The comdolls advanced against most of their European counterparts while struggling to the dollar and yen. New Zealand’s quarterly inflation expectations figure slipped from 2.2% to 2.1% while Canadian banks were closed for the holiday. China’s trade balance is up for release next and no changes are eyed.

By Kate Curtis from Trader’s Way

995

Forex Major Currencies Outlook (Aug 09, 2017)

USD

The US dollar staged a strong rally after seeing another round of upbeat medium-tier data. The JOLTS job openings figure came in at a record high of 6.16 million, signaling plenty of hiring opportunities and a likely pickup in employment in the coming months. The NFIB Small Business Index and the IBD/TIPP Economic Optimism Index also came in stronger than expected. Final wholesale inventories, preliminary non-farm productivity, and unit labor costs are lined up next.

EUR

The euro retreated to the dollar and yen but managed to advance against commodity currencies as risk appetite weakened. German and French trade balance came in slightly higher than expected to support ECB tapering speculations. Only the Italian industrial production report is due today and analysts are expecting to see a 0.2% uptick.

GBP

The pound was weighed down by risk aversion and Brexit jitters since there were no major reports to keep it supported. There are still no reports due from the UK economy today so it’s likely that market sentiment could push pound pairs around.

CHF

The franc gave up more ground to the dollar even after the Swiss jobless rate came in line with expectations at 3.2%. It managed to hold its ground against its other rivals since risk-off flows also tend to support the Swiss currency. There are no reports due from Switzerland today.

JPY

The yen was the biggest winner for the day as it benefitted from risk aversion stemming from the tension with North Korea. The hermit nation has threatened to launch a missile strike on the nearby U.S. territory of Guam. Japanese preliminary machine tool orders are up for release but all eyes and ears are on U.S. and North Korea.

Commodity Currencies (AUD, NZD, CAD)

The comdolls gave up a lot of ground as risk aversion returned to the markets. Traders are also pricing in downbeat expectations for the RBNZ decision as hiring and inflation have been weak for the past quarter. Australia reported a 1.2% drop in Westpac consumer sentiment data while Chinese CPI fell short of estimates at 1.4% versus 1.5%. The API reported another large draw in crude oil stockpiles so traders are waiting to see if the EIA report will follow suit.

By Kate Curtis from Trader’s Way

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996

Forex Major Currencies Outlook (Aug 10, 2017)

USD

The US dollar raked in some gains on risk-off flows but returned some of these when markets calmed down. Data indicated that wage pressures could remain subdued as unit labor costs posted a weaker than expected 0.6% uptick versus the projected 1.1% climb while non-farm productivity picked up. Initial jobless claims and PPI are due today, along with a speech by FOMC member Dudley.

EUR

The euro had a mixed run as it acted as a safe-haven in Europe but weakened to the likes of the yen and dollar. Italy reported a stronger than expected industrial production figure of 1.1% versus the projected 0.2% uptick. French industrial production and Italian trade balance are due next.

GBP

The pound also had a mixed run but was mostly weaker to the euro and the franc. There were no reports out of the UK economy yesterday while today has the manufacturing production and goods trade balance due. These are considered leading indicators of growth and might have a strong impact on pound direction, especially if reports come in weaker than expected.

CHF

The franc carried on with its strong risk-off rally but paused later on in the day as traders grew wary of SNB intervention again. There were no reports out of the Swiss economy yesterday and none are due today so market sentiment related to the North Korean situation could push franc pairs around.

JPY

The yen was also a big winner thanks to risk-off flows from North Korea’s missile threats but it also paused from its rally on profit-taking towards the end of the US session. Japanese core machinery orders posted a weaker than expected 1.9% slide versus the estimated 3.6% rebound while PPI came in stronger than expected at 2.9%.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were the weakest of the bunch as risk-taking was dampened by threats of a strike from North Korea. Crude oil ticked slightly higher when the EIA report printed a larger than expected draw of 6.5 million barrels but the Loonie failed to draw much support. The RBNZ kept interest rates on hold at 1.75% as expected while signaling the need for a lower NZD.

By Kate Curtis from Trader’s Way

997

Forex Major Currencies Outlook (Aug 11, 2017)

USD

The US dollar was in a weak spot against its peers, weighed down by weak PPI, downbeat Fed rhetoric, and threats from North Korea. US equity indices chalked up large losses for the day as investors are starting to get worried about an actual strike from Pyongyang while Trump refuses to take a more diplomatic stance. Headline and core PPI fell 0.1% and the CPI readings are due today.

EUR

The euro was unable to make much headway after seeing a miss in French industrial production. The report chalked up a 1.1% drop versus the estimated 0.6% dip but the Italian trade balance managed to beat forecasts. Final CPI readings from Germany and France are due today so upgrades or the lack of downgrades could still be a plus for the shared currency.

GBP

UK economic reports turned out mixed as manufacturing production came in line with estimates, the goods trade balance printed a larger deficit, and the industrial production report beat expectations. Traders still seem to be seeing some signs of resilience in the economy and the lack of top-tier UK data today could keep this sentiment in place.

CHF

The franc was able to score some gains on risk-off moves even as traders are wary of SNB intervention. There were no reports out of the Swiss economy then and none are due today so market sentiment could keep pushing franc pairs around.

JPY

The yen was the consistent winner for the day since it took its share of the dollar’s safe-haven flows. Core machinery orders saw a worse than expected 1.9% drop while PPI jumped from 2.2% to 2.6%, keeping positive inflation expectations supportive of yen gains. Japanese banks are closed for the holiday today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls continued to reel from risk aversion as traders moved their holdings to safe-havens in light of the tension with North Korea. The Kiwi also got dragged lower during RBNZ head Wheeler’s speech when he threatened currency intervention if NZD keeps rallying. There are no major reports due from the comdoll economies for the rest of the day so market sentiment could be the main driver.

By Kate Curtis from Trader’s Way

998

Forex Major Currencies Outlook (Aug 14, 2017)

USD

US CPI figures came in weaker than expected as the headline and core readings came in at 0.1% versus the projected 0.2% pickup, further dampening September rate hike expectations. There are no major reports lined up from the US today so dollar pairs could take their cues from market sentiment, which is mostly being influenced by the North Korea situation.

EUR

Euro zone data came in mixed with German and French final CPI readings coming in line with estimates and the German WPI printing a worse than expected 0.1% dip versus the projected 0.3% uptick. French preliminary non-farm payrolls turned out stronger than expected with a 0.5% gain versus the projected 0.4% rise. Euro zone industrial production is due next and a 0.4% drop is eyed.

GBP

There were no major reports out of the UK economy last Friday and none are due today, leaving traders to price in their expectations for this week’s top-tier releases. These include the CPI, jobs data, and retail sales readings that might influence BOE policy bias. Apart from that, market sentiment could also determine how pound pairs might behave.

CHF

The franc was able to take advantage of some risk-off flows but it looks like traders are still wary of SNB intervention. There were no reports out of the Swiss economy on Friday and none are due today so risk sentiment might still be the main driver of franc price action.

JPY

The yen raked in more gains on Friday but gave up some ground on profit-taking at the end of the week. Earlier today, Japan printed a stronger 1.0% GDP growth compared to the earlier 0.3% expansion. The price index was down 0.4%, half of the earlier 0.8% slide. Market sentiment could also push yen pairs around, based on headlines regarding North Korea.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to make a bit of a rebound before the week came to a close as traders booked profits to avoid weekend risk. Over the weekend, New Zealand reported a 2.0% increase in headline retail sales for Q2 and a 2.1% gain in core retail sales. Chinese industrial production, fixed asset investment, and retail sales data are lined up next but risk appetite might still be the bigger drivers of comdoll movement.

By Kate Curtis from Trader’s Way

999

Forex Major Currencies Outlook (Aug 15, 2017)

USD

The US dollar recovered from its downbeat performance late last week, thanks to upbeat remarks from Fed official Dudley and a positive close for equities. Although it has been reported that Kim Jong Un has been briefed about the missile strike plan on Guam, he did note that they’ll wait and see how the US acts first. US retail sales data are lined up next and rebounds are eyed.

EUR

The euro gave up some ground upon seeing downbeat industrial production data. The report printed a 0.6% drop versus the estimated 0.4% dip while the previous reading was downgraded to 1.2%. German preliminary GDP is due next and a 0.7% growth figure is eyed while French and Italian banks are closed for the holiday.

GBP

The pound tried to hold its ground as traders are pricing in expectations for the upcoming CPI release. The headline reading is projected to rebound from 2.6% to 2.7% while the core reading could tick up from 2.4% to 2.5%. Weaker than expected data, however, could lead to more losses for the UK currency.

CHF

The franc gave up some of its recent gains as risk appetite improved in the markets. There were no reports out of the Swiss economy yesterday while the PPI is lined up today. A flat reading is eyed after the report printed a 0.1% dip in the previous period.

JPY

The yen was also weaker against most of its peers as risk-taking appeared to return or traders booked profits from their earlier long positions. Japan’s revised industrial production report is lined up but no revisions to the initial 1.6% estimate are eyed. Market sentiment could continue driving yen pairs from here.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were still in a weak spot even with the pickup in risk-taking. WTI crude oil edged down on looming NAFTA renegotiations while downbeat data from China also weighed on the Aussie and Kiwi. Chinese industrial production slipped from 7.6% to 6.4% while retail sales fell from 11% to 10.4%. RBA minutes are due next and New Zealand will have its GDT auction in the next Asian session.

By Kate Curtis from Trader’s Way

1000

Forex Major Currencies Outlook (Aug 16, 2017)

USD

The US dollar got a bit of a boost from stronger than expected July retail sales figures, along with positive revisions for the June report. The Empire State manufacturing index also posted a strong rise from 9.8 to 25.2, higher than the projected 10.1 figure. Import prices posted the projected 0.1% uptick. US building permits and housing starts are due today, but the FOMC minutes could have a bigger impact on the dollar. Cautious remarks downplaying the odds of a September hike could be dollar bearish and traders are also anticipating more details on the balance sheet runoff.

EUR

The euro took a few hits in recent trading as the only piece of data turned out below expectations. Germany reported a 0.6% GDP reading for Q2 versus the projected 0.7% expansion. The region’s flash GDP is due today and a 0.6% reading is eyed, with weaker than expected results likely to weigh on ECB tapering expectations.

GBP

The pound continued to slump against its peers upon seeing weaker than expected CPI. The headline reading was unchanged at 2.6% instead of rising to the estimated 2.7% figure while the core figure also held steady at 2.4%. Jobs data is due next and the claimant count could come in at 3.2K, lower than the earlier 5.9K rise in joblessness. The average earnings index is projected to hold steady at 1.8%.

CHF

The franc continued to lose ground as risk appetite improved in the markets on easing concerns about North Korea. Swiss PPI posted a flat reading as expected and there are no major reports due from Switzerland today, leaving market sentiment in charge of franc movements.

JPY

The yen was also on the back foot as improvements in risk appetite forced the lower-yielding currency to retreat. Japan’s industrial production reading was upgraded from 1.6% to 2.2% instead of staying unchanged as expected. There are no reports due from the Japanese economy today.

Commodity Currencies (AUD, NZD, CAD)

The Kiwi took a hit from the GDT auction which yielded a 0.4% drop in dairy prices. In Australia, new motor vehicle sales slipped by 2.0% while the wage price index posted another 0.5% gain for Q2 as expected. The API reported another larger than expected draw in crude oil stockpiles while the EIA is expected to print a reduction of 3 million barrels. New Zealand has its quarterly PPI report lined up as well.

By Kate Curtis from Trader’s Way

1001

Forex Major Currencies Outlook (Aug 17, 2017)

USD

The US dollar was weighed down heavily by downbeat housing starts and building permits, followed by the FOMC minutes and the fallout in Washington. Building permits fell from 1.28M to 1.22M while housing starts declined from 1.21M to 1.16M. Meanwhile, the FOMC minutes revealed that policymakers are still reluctant to commit to a balance sheet runoff date and the fallout from Trump’s handling of Charlottesville has weighed on fiscal policy speculations. Initial jobless claims, industrial production, and the Philly Fed index are lined up next.

EUR

Euro zone economic data simply came in line with expectations as Italy reported a 0.4% growth figure while the region chalked up a 0.6% expansion. Final CPI readings are due today but traders might be more interested to read the ECB minutes as many are hoping to see more clues on tapering.

GBP

The pound took a break from its slide upon seeing upbeat UK jobs data. The claimant count fell by 4.2K instead of indicating a 3.2K rise in joblessness for July while the June figure saw an upgrade. The average earnings index climbed to 2.1% while the earlier reading was upgraded to 1.9% and the jobless rate declined from 4.5% to 4.4%. Retail sales is due next and a 0.2% uptick is eyed.

CHF

The franc had a mixed run as it reacted mostly to country-specific events. There were no reports out of the Swiss economy yesterday and none are due today so market sentiment could still push franc pairs around.

JPY

The yen took advantage of dollar weakness but was still in a weak spot against its higher-yielding counterparts. Earlier today, Japan printed a stronger than expected trade surplus of 0.34T JPY versus the projected 0.20T JPY and the earlier 0.09T JPY reading.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to rake in more gains, especially the Kiwi which got a boost from upbeat PPI data. Input prices surged 1.4% versus the 0.9% consensus while output prices rose 1.3% versus the projected 0.7% gain. Crude oil inventories fell by 8.9 million barrels, larger than the estimated draw of 3 million barrels to ease oversupply concerns. Australia also printed a stronger than expected 27.9K increase in hiring for July.

By Kate Curtis from Trader’s Way

1002

Forex Major Currencies Outlook (Aug 18, 2017)

USD

The dollar remained in a weak spot due to the fallout from Trump’s response to the violence in Charlottesville. Economic data also turned out mixed, leaving some doubts on the Fed’s ability to hike again in September. This was emphasized by FOMC member Kaplan who spoke about the slack in the labor market and the need to exercise more patience in waiting for stronger inflation before tightening. Another speech by Kaplan is scheduled, along with the release of the preliminary UoM consumer sentiment index.

EUR

The euro tumbled against its peers after the ECB minutes were released as these didn’t contain much conviction on tapering as many expected. To add to that, the terror attack in Barcelona weighed heavily on risk-taking and investor sentiment. In terms of data, final CPI readings from the region were unchanged at 1.3% for the headline figure and 1.2% for the core version.

GBP

The pound resumed its drop against some of its rivals even after the UK reported stronger than expected retail sales. Consumer spending ticked 0.3% higher versus the projected 0.2% increase. There are no reports due from the UK for the rest of the week.

CHF

The franc was able to take advantage of risk aversion as traders were hesitant to buy up the dollar anyway. There were no reports out of the Swiss economy and none are due today so market sentiment could continue to prop the Swiss currency up or profit-taking could ensue.

JPY

The yen was able to rake in plenty of gains on the BOJ’s JGB trimming and the pickup in risk-taking. Japan’s trade balance also turned out stronger than expected at a surplus of 0.34 trillion JPY. CPI readings are due next and a strong batch could fuel expectations of another reduction in purchases of bonds by the central bank.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were badly hit by the return in risk aversion in the past sessions, spurred by a terror attack in Barcelona and political risks in the US. Australia reported a higher than expected 27.9K rise in employment versus the projected 19.8K gain while the earlier figure was upgraded to 20K. Canada is set to print its CPI figures next and strong readings could keep traders expecting another BOC hike.

By Kate Curtis from Trader’s Way

1003

Forex Major Currencies Outlook (Aug 22, 2017)

USD

The dollar edged slightly lower at the start of the week as trader reacted to Bannon’s resignation. This reminded market watchers of the internal conflict in Washington and how this could derail the fiscal reform agenda. Also, resurfacing tensions with North Korea dampened the dollar’s gains upon the start of the joint military drills between the US and South Korea. There were no reports out of the US yesterday while today has HPI and the Richmond manufacturing index.

EUR

The euro was able to advance against some of its peers as traders are pricing in taper remarks from Draghi in the upcoming Jackson Hole Symposium. There were no major reports out of the region yesterday while today has the German ZEW economic sentiment figure lined up. Analysts are expecting to see a dip from 17.5 to 14.8. The region’s index could fall from 35.6 to 34.2.

GBP

The pound struggled to hold its ground on the lack of top-tier UK data. The Rightmove HPI showed a 0.9% drop in house prices versus the earlier 0.1% uptick. The CBI industrial order expectations index is due next and a fall from 10 to 8 is eyed.

CHF

The franc was able to rake in some gains on returning risk aversion due to the start of the military exercises between the US and South Korea. There were no reports out of the Swiss economy yesterday while today has the trade balance on the docket. Analysts are expecting to see a wider surplus of 2.88 billion CHF compared to the earlier 2.81 billion CHF.

JPY

The yen also caught some wins on weakening dollar demand and a pickup in risk aversion. Japan’s all industries activity index logged in a 0.4% uptick versus the projected 0.5% gain. There are no reports due from the Japanese economy today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were in a weak spot due to the return in risk aversion, although it has been reported that OPEC output likely dropped while compliance reached 94%. Canadian wholesale sales saw a 0.5% drop versus the projected 0.6% gain.

By Kate Curtis from Trader’s Way

1004

Forex Major Currencies Outlook (Aug 23, 2017)

USD

The dollar regained some ground on the return of risk aversion stemming from North Korea jitters. The US and South Korea have started their joint military exercises this week and a North Korean diplomat has been quoted saying that this could be an act of provocation. The Richmond manufacturing index was unchanged at 14 while US HPI posted a meager 0.1% uptick. Flash manufacturing and services PMIs are due next, along with new home sales data.

EUR

The euro tried to hold its ground even with downbeat economic data. Germany’s ZEW economic sentiment index fell from 17.5 to 10 versus the 14.8 consensus while the region’s index dropped from 35.6 to 29.3. Flash manufacturing and services PMIs are due and strong reports could allow the shared currency to rebound.

GBP

UK public sector net borrowing was at a deficit of 0.8 billion GBP, which means that the government was able to collect more than it spent for the period. There are no major reports lined up from the UK economy today but the pound remains under pressure on Brexit risks.

CHF

The franc had a mixed run as it mostly reacted to currency-specific events, managing to draw a bit of a bid on risk aversion. The Swiss trade balance showed a larger than expected surplus of 3.51 billion CHF versus the projected 2.88 billion CHF, easing the pressure on the SNB to intervene to keep the currency weak.

JPY

The yen was also able to benefit from risk-off flows as the revival of North Korean concerns prompted a flight to safety. Japan’s flash manufacturing PMI rose from 52.1 to 52.8, higher than the projected 52.3 figure. Risk appetite could continue to push yen pairs around from here.

Commodity Currencies (AUD, NZD, CAD)

Canada’s retail sales reports came in mixed but the Loonie was able to rake in some gains. The core reading showed a 0.7% gain instead of staying flat but the headline figure was up only 0.1% instead of the 0.2% consensus on weaker auto and gasoline sales. Crude oil inventories data is lined up next, along with New Zealand’s trade balance.

By Kate Curtis from Trader’s Way

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Forex Major Currencies Outlook (Aug 24, 2017)

USD

The dollar gave up some ground on speculations of a government shutdown as Trump threatened to trigger one unless he gets the funds to build the wall along the Mexican border. There have also been whispers of conflict among lawmakers that refuse to support this agenda but Senate majority leader McConnell assured that their team is working closely with the President. Data turned out mixed, with the manufacturing PMI posting a surprise dip in activity and the services component surprising to the upside. New home sales disappointed due to rising prices making homes less affordable to potential buyers. The attention turns to the start of the Jackson Hole Symposium next and Yellen’s speech.

EUR

The euro dipped after Draghi’s testimony barely contained any strong hints on monetary policy moves but the shared currency soon recovered on expectations of taper-related remarks in his upcoming Jackson Hole Speech. Euro zone PMI readings were mostly stronger than expected while consumer confidence held steady at -2.

GBP

The pound had a mixed run as it reacted mostly to its counterparts instead of establishing its own direction. There were no major reports out of the UK economy in previous trading sessions and traders are turning to the second GDP estimate next. Analysts are expecting to see another 0.3% expansion but project that business investment would slow to 0.2% from the earlier 0.6% gain.

CHF

The franc was able to benefit from a continuation of risk-off and anti-dollar moves stemming from threats of a government shutdown from Trump. There were no reports out of the Swiss economy recently and none are due today so the franc could take its cue from euro action and Draghi’s remarks.

JPY

The yen took advantage of dollar weakness stemming from government shutdown concerns and persistent risks from North Korea. Japan’s flash manufacturing PMI was stronger than expected at 52.8 versus the consensus at 52.3 and the earlier 52.1 figure. There are no reports due from Japan today, leaving traders to price in their expectations for the CPI data due on Friday.

Commodity Currencies (AUD, NZD, CAD)

The Kiwi was the weakest of the bunch as it got bogged down by GDP downgrades in the Treasury’s pre-election fiscal update. Meanwhile, the Loonie stayed supported after crude oil advanced on the EIA report, which indicated that stockpiles fell by 3.3 million barrels as expected. New Zealand’s trade balance is due next and a smaller deficit of 200 million NZD from the earlier 242 million NZD shortfall is eyed.

By Kate Curtis from Trader’s Way

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Forex Major Currencies Outlook (Aug 25, 2017)

USD

The dollar traded mostly sideways as traders are taking it easy ahead of Yellen’s Jackson Hole speech. Medium-tier reports turned out weaker than expected, with existing home sales falling in line with the downbeat trend of earlier housing reports and initial jobless claims showing a slight uptick in unemployment. US durable goods orders data is also due today but the attention is likely fixed on Yellen’s remarks.

EUR

The shared currency also traded carefully as Draghi’s Jackson Hole speech is also one of the more anticipated parts of the event. Some expect the central bank to drop taper clues while others think that the speech might disappoint. German Ifo business climate index is also due, along with the country’s final GDP reading.

GBP

The UK second GDP estimate came in line with estimates of no changes from the earlier 0.3% figure. However, the preliminary business investment reading for the quarter showed a flat reading, slower than the estimated 0.2% uptick and the earlier 0.6% increase. Also, the CBI realized sales index slumped from 22 to -10 instead of dipping to 15. There are no reports due from the UK today.

CHF

The franc traded sideways for the most part but gave up some gains when risk-taking returned. There were no reports out of the Swiss economy yesterday and none are due today so market sentiment could be the main driver or the franc could simply react to country-specific events.

JPY

The yen returned some of its recent gains as risk appetite kicked in and profit-taking took place ahead of the Jackson Hole speeches. Japan is set to print its CPI readings next, with both the national and Tokyo core CPI readings expected to show a slightly faster increase in price levels.

Commodity Currencies (AUD, NZD, CAD)

The Loonie was able to rake in gains against its peers even as crude oil dipped on a likely increase in output ahead of Hurricane Harvey’s landfall in Texas. Meanwhile, the Kiwi continued to slide across the board following the downbeat forecasts in the Treasury’s pre-election fiscal update. There are no reports due from the comdoll economies for the rest of the day so market sentiment could push these pairs around.

By Kate Curtis from Trader’s Way

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Forex Major Currencies Outlook (Aug 28, 2017)

USD

The US dollar took a hit after the Jackson Hole speeches as Yellen expressed some concerns about inflation, downplaying hopes of a Fed rate hike in September. Headline durable goods orders came in weaker than expected at a 6.8% loss versus the projected 6.0% drop but the core reading came in slightly better than expected at 0.5%. Goods trade balance and preliminary wholesale inventories are due next.

EUR

The euro surged across the board after Draghi refrained from dropping cautious remarks during his Jackson Hole speech. German final GDP and import prices also came in line with expectations. Data on private loans and M3 money supply are due today but these aren’t likely to have a strong impact on euro action.

GBP

The pound was once again weighed down by Brexit concerns are talks are set to resume this week. There were no reports out of the UK economy on Friday while today has an empty docket again since banks are closed for the holiday.

CHF

The franc had a mixed run as it reacted mostly to currency-specific events rather than establishing its own direction. There are still no reports due from the Swiss economy today so market sentiment could push franc pairs around or consolidation could be in play.

JPY

The yen regained some ground as it took advantage of dollar weakness after the Jackson Hole Symposium. Data from Japan turned out mixed, with the national core CPI coming in line with estimates of 0.5% and the Tokyo core CPI beating expectations at 0.4%. There are no reports due from Japan today so quiet trading could be in order.

Commodity Currencies (AUD, NZD, CAD)

The comdolls had a mixed run as the gang was able to benefit from dollar weakness but were still vulnerable to euro strength and risk aversion. There were no reports out of the comdoll economies then and none are due today so market sentiment could be the main driver of price action.

By Kate Curtis from Trader’s Way

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Forex Major Currencies Outlook (Aug 29, 2017)

USD

The dollar dipped lower against its rivals at the start of the week as Hurricane Harvey weighed heavily on energy stocks and US equity indices. Data from the US also turned out weaker than expected as the goods trade deficit widened from $64 billion to $65.1 billion versus the projected $64.5 billion shortfall on weaker exports of motor vehicles. The CB consumer confidence index is due today and a dip from 121.1 to 120.3 is eyed.

EUR

The euro was mostly higher against its peers as the shared currency acted as safe-haven in the European region. Data was actually weaker than expected but traders are still bullish on the euro after Draghi refrained from talking down the currency. The German GfK consumer climate index is due today, along with French consumer spending and preliminary GDP data.

GBP

The pound was able to bounce back as Brexit jitters started to fade while talks are underway. There were no reports out of the UK economy so far as banks are closed for the Summer Day holiday and only the Nationwide HPI is lined up today. Analysts are expecting to see a 0.1% uptick in house prices, lower than the earlier 0.3% gain.

CHF

The franc had a mixed run as it reacted mostly to currency-specific events and market sentiment. There were no reports out of the Swiss economy on Monday and none are lined up today so the same behavior could be seen for franc pairs.

JPY

The yen gave up some ground to its peers but was able to rake in gains against the Canadian dollar on weaker oil prices. Japanese household spending data is due today and a slowdown from 2.3% to 0.8% is eyed. The unemployment rate is also due and no change from the earlier 2.8% figure is expected. The BOJ will also print its core CPI figure and a sizeable gain could revive expectations of more reduction in JGB purchases.

Commodity Currencies (AUD, NZD, CAD)

The Aussie and Kiwi were mostly stuck in consolidation, waiting for bigger market catalysts for the time being. The Loonie, meanwhile, was bogged down by a sharp fall in oil prices due to Hurricane Harvey’s impact on refineries in the US Gulf Coast and talks of NAFTA termination. Underlying inflation reports are due from Canada today.

By Kate Curtis from Trader’s Way