Daily Market Outlook by Kate Curtis from Trader's Way

[katetrades]

Forex Major Currencies Outlook (Jan 04, 2017)

USD

The US dollar scored gains across the board, buoyed by upbeat economic data. The ISM manufacturing PMI was up from 53.2 to 54.7, much higher than the projected 53.7 figure. Components for prices, employment, production, and new orders all showed gains. Construction spending also beat expectations with a 0.9% gain. The FOMC minutes are up for release today and this might lead to another round of dollar rallies.

EUR

The euro weakened to the dollar and comdolls but managed to hold steady against the yen. Data from the region was mixed, as the French preliminary CPI missed expectations while the German flash CPI met consensus. German unemployment change data showed a larger 17K reduction in joblessness versus the projected 5K drop. Final services PMI readings are due today, along with the Spanish unemployment change report.

GBP

The pound got a bit of a boost from the upside surprise in its manufacturing PMI, although Brexit concerns dampened the currency's gains. The reading rose from 53.6 to 56.1 instead of dipping to the 53.3 consensus. Construction PMI is due today and a dip from 52.8 to 52.6 is expected.

CHF

The franc gave up ground to the dollar but scored some gains against the euro and pound. Swiss manufacturing PMI fell from 56.6 to 56.0, lower than the projected 56.1 figure. There are no reports due from the Swiss economy today.

JPY

The Japanese yen put up a fight against the dollar but was no match to comdoll strength. Japan's final manufacturing PMI was upgraded from 51.9 to 52.4 to reflect a faster pace of industry growth than initially reported. There are no other reports due from Japan today so market sentiment and the FOMC minutes could push yen pairs around.

Commodity Currencies (AUD, NZD, CAD)

The comdolls staged rallies late in the day as gold prices picked up. Crude oil was weaker on reports that Libya plans to increase production with its exemption from the OPEC deal. New Zealand reported a 3.9% drop in dairy prices during its latest GDT auction. No other top-tier reports are lined up from the comdolls today.

By Kate Curtis from Trader's Way

 

[modi mood]

Great , thank you

 

[katetrades]

Forex Major Currencies Outlook (Jan 05, 2017)

USD

The US dollar gave up ground across the board when the FOMC minutes revealed that policymakers were split between faster and gradual tightening. While many expect inflation to reach their 2% target soon on rising energy prices, others expressed concern about hiking too soon ahead of Trump's fiscal policy changes. For today, the ADP non-farm employment change report is due and a slower gain of 171K is eyed, compared to the previous 216K increase. The ISM non-manufacturing PMI is also due and a dip from 57.2 to 56.6 is expected.

EUR

The euro took advantage of dollar weakness but was no match to comdoll strength. Euro zone flash CPI estimates turned out stronger than expected, with the headline reading up from 0.6% to 1.1% and the core figure rising from 0.8% to 0.9%. Final services PMI readings were mostly upgraded while the Spanish unemployment change report showed a larger than expected reduction in joblessness.

GBP

The pound advanced to the dollar but was barely able to make much headway against its peers, despite stronger than expected PMI readings. The construction PMI beat consensus with a rise from 52.8 to 54.2 instead of dropping to 52.6. Services PMI is due today and a fall from 55.2 to 54.8 is expected.

CHF

The franc was able to recover against the dollar and held on to its gains against the pound, but it gave up ground to the euro. There were no reports out of the Swiss economy yesterday so market sentiment was the main driver of price action. Swiss CPI is due today and a 0.1% drop in price levels is eyed.

JPY

The yen was one of the stronger performers as traders pared their dollar holdings. There have been no major reports out of Japan recently while today has the 10-year bond auction scheduled. Another dip in demand could bring yen weakness, although market sentiment is still likely to push yen pairs around.

Commodity Currencies (AUD, NZD, CAD)

The Loonie was able to benefit from stronger oil prices in recent trading sessions, following reports that Kuwait Petroleum Corporation already disclosed its planned production cuts to its clients. The API crude oil inventories report also indicated a larger than expected draw in stockpiles, ahead of today's EIA report which might show a draw of 1.8 million barrels. China's Caixin services PMI indicated a rise from 53.1 to 53.4, following the earlier increase in the manufacturing component from 50.9 to 51.9.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Jan 06, 2017)

USD

The US dollar had another weak performance after leading jobs indicators missed expectations. The ADP report printed a meager 153K gain versus the projected 171K figure and the earlier 215K increase while the jobs component of the ISM non-manufacturing PMI showed a slide. Challenger job cuts rose 42% in December, its fastest rise since September 2015. All eyes and ears are on the NFP today and a 175K rise in hiring is eyed while average hourly earnings could tick up by 0.3%.

EUR

The euro took advantage of dollar weakness but was no match to yen or comdoll strength. Medium-tier reports from the region were still upbeat but the uncertainties looming ahead of the French and German elections, as well as Italy's banking troubles, prevented the shared currency from making gains across the board. German factory orders and retail sales data are due today.

GBP

The pound also advanced against the dollar but failed to hold on to its gains against the rest of its peers even after seeing strong UK data. Services PMI also beat expectations with a rise from 55.2 to 56.2 instead of falling to 54.8. There are no reports due from the UK economy today.

CHF

The franc was able to chalk up a positive day, as it advanced to the dollar and the European currencies. Swiss CPI came in line with expectations of a 0.1% dip in price levels while today has the SNB foreign currency reserves data due, which might reveal whether or not the central bank is intervening in the currency market.

JPY

The yen continued to gain ground against its peers as investor jitters can be felt all over the globe. To top it off, the yen is regaining some of its lost profits to the dollar now that traders are doubting that the Fed can stick with its plan of hiking rates thrice this year. Japanese average cash earnings printed a 0.2% uptick as expected.

Commodity Currencies (AUD, NZD, CAD)

The comdolls had a mixed performance as they consolidated to the yen but racked up some wins to the dollar. Australia's trade balance beat expectations with a 1.24 billion AUD surplus. Canada is set to print its jobs numbers today and a 5.1K drop in employment is eyed.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Jan 09, 2017)

USD

The US dollar gave up a bit of ground when the actual December NFP reading fell short of estimates, posting a 158K gain versus the projected 175K increase. However, the currency held fast and advanced later on as traders got wind of upward revisions in the November report and realized that the pickup in the jobless rate was due to higher labor force participation. Average hourly earnings also beat expectations with a 0.4% rise versus the estimated 0.3% uptick. The Fed's labor market conditions index is up for release today.

EUR

The euro continued to climb against its peers even though data came in mixed. German factory orders fell 2.5% as expected while retail sales slipped 1.8% versus the projected 0.8% decline. German industrial production and trade balance are due today, along with the region's Sentix investor confidence index and unemployment rate.

GBP

The pound resumed its slide against most of its peers as there were no reports to keep it supported and traders shrugged off the upside surprises in PMIs earlier in the week. UK Halifax HPI is due today and a 0.3% rise in house prices is expected, although traders are likely to pay more attention to Brexit-related headlines.

CHF

The franc was in a weak spot against most of its peers, except against the British pound. Swiss foreign currency reserves ticked lower, easing fears that the the SNB is intervening in the currency market. Swiss retail sales data is up for release today and a 0.4% year-over-year rebound is eyed.

JPY

The yen was also on weak footing as risk appetite appeared to improve and traders revived their love for the dollar. Japanese banks are closed for the holiday today so traders could continue to react to market sentiment in trading yen pairs.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were the strongest performers towards the end of the week, particularly the Loonie which was lifted by strong Canadian jobs data. The economy added 53.7K jobs in December instead of losing 5.1K jobs while the trade balance turned into a 0.5B CAD surplus instead of printing a 1.6B CAD deficit. The Ivey PMI also beat expectations by rising from 56.8 to 60.8 versus the 56.0 consensus. The BOC Business Outlook Survey is due next.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Jan 10, 2017)

USD

The US dollar was unable to establish a clear direction in recent sessions as US data came in mixed. Consumer credit showed strong gains in November while the Fed's labor market conditions index slumped back to negative territory at -0.3. JOLTS job openings data and NFIB small business index are lined up today.

EUR

The euro advanced to the dollar, slumped against the yen, and consolidated against the commodity currencies. Data from the region has also been mixed as German trade balance and Sentix investor confidence beat expectations while German industrial production and Italy's unemployment rate fell short. For today, French industrial production data is due and a 0.5% rebound is eyed.

GBP

The pound was the weakest of the bunch as Brexit-related headlines weighed on the currency. Over the weekend, PM May hinted that they're willing to forego access to the single market in exchange for closing UK borders while Chancellor Hammond reiterated their plans to conclude Brexit talks by April 2019. Halifax HPI beat expectations with a 1.7% gain and the BRC retail sales monitor posted a stronger 1.0% gain.

CHF

The franc tossed and turned against the dollar but was able to rake in strong gains against the pound. Swiss retail sales came in stronger than expected with a 0.9% gain versus the projected 0.4% uptick and earlier 0.7% drop. Swiss jobless rate is due today and no change from the earlier 3.3% reading is eyed.

JPY

The yen was one of the strongest performers as it took advantage of the selloff in higher-yielding currencies. Japanese banks were closed for the holiday yesterday while today has the consumer confidence index on tap. A climb from 40.9 to 41.3 is expected.

Commodity Currencies (AUD, NZD, CAD)

The comdolls struggled to hold on to their gains in recent sessions, giving up ground against the Japanese yen. Crude oil took a hit while Australia reported a smaller than expected 0.2% gain in retail sales versus the projected 0.4% increase. Chinese CPI came up short with a 2.1% gain instead of the 2.2% figure but PPI beat expectations at 5.5% versus 4.6%. Canadian building permits and housing starts are due next.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Jan 11, 2017)

USD

The dollar had a mixed performance as economic data did very little to provide strong direction. JOLTS job openings came in at 5.52M, up from the downgraded 5.45M reading in October but short of the estimated 5.59M figure. The NFIB small business index showed a strong climb from 98.4 to 105.8. There are no major reports due from the US today.

EUR

The euro was able to advance against the dollar but weakened against most of its major counterparts. French industrial production data beat expectations with a 2.2% gain versus the projected 0.5% uptick. There are no reports lined up from the region today.

GBP

The pound was able to make a quick bounce against most of its rivals, as Brexit headlines took the back seat. UK BRC retail sales monitor printed a sharper 1.0% gain versus the earlier 0.6% uptick. UK manufacturing production and goods trade balance figures are lined up today, with the former slated to show a 0.6% rebound and the latter likely to print a wider 11.2 billion GBP deficit.

CHF

The franc was mostly weaker even though the Swiss jobless rate came in line with expectations at 3.3%. There are no reports due from the Swiss economy today so the franc could take its cue from country-specific data.

JPY

The yen continued to rake in gains against its peers as the Japanese currency took advantage of the slowdown in dollar demand. Japanese consumer confidence data improved from 40.9 to 43.1 and leading indicators are due today.

Commodity Currencies (AUD, NZD, CAD)

The Loonie was bogged down by weak crude oil prices on expectations of higher US inventories. Building permits and housing starts printed mixed results as well. Australian retail sales printed a slower 0.2% gain versus the projected 0.5% rise while Chinese CPI fell short of estimates. EIA crude oil inventories data lined up today could push Loonie pairs around once more.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Jan 12, 2017)

USD

The US dollar staged a sudden selloff when President-elect Trump delivered his first press conference during which he focused on a number of issues such as Russia's election hack, drug overpricing, and Mexico's automobile industry among many others but failed to share more fiscal policy details. US initial jobless claims and speeches by FOMC members Evans and Harker are lined up.

EUR

The euro had a mixed performance as it advanced to the dollar but weakened against most of its rivals. There have been no major reports out of the region yesterday but Brexit headlines dampened the outlook for the bloc. French final CPI and euro zone industrial production numbers are on tap today and strong figures could spur a rebound. ECB minutes are also due.

GBP

The pound was still one of the weakest performers even after BOE Governor Carney highlighted upbeat economic data and mentioned that the Brexit might not be the biggest risk to stability. UK data turned out mixed, as manufacturing production beat expectations with a 1.3% gain versus the projected 0.6% uptick while goods trade balance printed a wider 12.2 billion GBP deficit. There are no major reports lined up from the UK today.

CHF

The franc took advantage of dollar weakness but tossed and turned against its European counterparts. There were no reports out of Switzerland yesterday and none are due today so the franc could continue to react to country-specific updates or market sentiment.

JPY

The yen raked in more gains against its peers as the dollar's slide left the Japanese currency as the more appealing safe-haven. Japan's bank lending data and current account balance also came in stronger than expected, following the improvement in leading indicators and reminding traders of the BOJ's GDP upgrade.

Commodity Currencies (AUD, NZD, CAD)

The comdolls rallied against the dollar and the European currencies even as US crude oil inventories reflected a larger than expected buildup of 4.1 million barrels. In New Zealand, commodity prices picked up by 0.7% in December. There are no major reports lined up from the commodity currencies.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Jan 13, 2017)

USD

The US dollar continued to slide as investors priced in concerns about the Trump presidency. Economic data was better than expected while FOMC voting members reaffirmed their rate hike time line and mostly upbeat assessment of the economy. US retail sales, PPI, and UoM consumer sentiment data are up for release today.

EUR

The euro was also in a weak spot against most of its peers, particularly the commodity currencies, but was on stronger footing against the pound. Italian industrial production beat expectations and so did the region's report but investors are wary of the potential Brexit repercussions on the EU if the UK is kicked out of the single market.

GBP

The pound continued to tumble across the board as traders pared their risk ahead of PM May's testimony today. There were no major reports out of the UK yesterday and the BOE credit conditions survey is lined up today. BOE member Haldane also has a testimony scheduled.

CHF

The franc strengthened against the dollar and its European rivals as risk aversion came into play. There were no reports out of the Swiss economy yesterday and none are due today so market sentiment could push franc pairs around.

JPY

The Japanese yen had a mixed performance as it ended in the green against the euro and pound but was no match to comdoll strength. Japan's Economy Watchers sentiment index climbed from 48.6 to 51.4, higher than the estimated 49.3 figure.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were the strongest performers in recent sessions, thanks to rising gold prices. China reported a smaller than expected trade surplus for January. The reading came in at 275B CNY versus the estimated 345B CNY figure and the earlier 298B surplus, dragged down by a sharper fall in exports.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Jan 16, 2017)

USD

The US dollar was off to a strong start this week on risk-off vibes in the markets. Traders seem to be shrugging off the impact of Trump's first press conference but are still wary ahead of the inauguration later this week. US reports were mixed, as headline retail sales and PPI beat expectations while core figures fell short of consensus. US banks are closed for Martin Luther King Day today.

EUR

The euro gapped down to most of its counterparts to start the week as traders are anticipating more bearishness with all the catalysts lined up. Data from the euro zone was actually stronger than expected on Friday but Brexit-related fears seem to be dominating price action. Euro zone trade balance is due today and a wider 23.2 billion EUR surplus is eyed.

GBP

The pound also started the week lower against its peers as traders are bracing themselves for UK PM May's Brexit speech midweek. Any indication that a "hard Brexit" would be a possibility could send the currency crashing lower. BOE Governor Carney has a speech lined up today and he could attempt to shore up confidence in the UK economy.

CHF

The franc had a volatile run on Friday as it was also dragged down by the rest of its European peers. There were no reports out of the Swiss economy then and none are due today so the franc could be pushed and pulled by market sentiment and country-specific action once more.

JPY

The Japanese yen is taking advantage of the jitters in the European region, raking in gains against the euro and pound while gapping up against most of its counterparts. Over the weekend, Japanese data turned out mixed as core machinery orders posted a sharper than expected 5.1% fall while PPI showed a smaller than expected 1.2% drop. Tertiary industry activity data and preliminary machine tool orders figures are due today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls are still able to hold on to their gains despite the risk-off vibes, possibly supported by speculations that China is poised for stronger growth and the pickup in commodity prices. However, the Chinese trade balance turned out weaker than expected on Friday due to a larger fall in exports. Australia posted a 0.5% gain in its MI inflation gauge, higher than the previous 0.1% uptick, while New Zealand printed a 0.8% decline in FPI.

By Kate Curtis from Trader's Way