Session close for Tuesday, Feb. 6: Settled at 1.2424, down 7.5 ticks
Fundamentals: The euro has been moving south at a slow but steady pace since Thursday mornings lower high. The tape did see buyers step in this morning on strong German Factory orders and follow through on German Bundesbank President Weidmann. Despite weak U.S data, the widest U.S trade deficit since 2008 and a disappointing JOLTs read, the euro did not hold its early ground. Price action hit a session low of 1.2345, the lowest level in two weeks but recovered from this level into settlement. St. Louis Fed President James Bullard commented that the strong labor market does not need to translate into inflation in an attempt to calm some fears that were likely set off by Friday’s wage growth data. While rising for nearly the last three months, the Euro continues to unwind its 2014 drop and price in more hawkish policy from the ECB, there now seems to be a bit of uncertainty on both sides of the pond. This should open the door for a nice consolidation period. Tomorrow there is a German 10-year bund auction at 4:40 am CT. New York Fed President Dudley speaks at 7:30 am CT, Chicago Fed President Evans at 9:15 and San Fran Fed President Williams at 4:20.
Technicals: Today’s session low nudged through first key support before reversing.
Session close: Settled at .9167, up 29 ticks
Fundamentals: The yen finished on the low of the session as equity markets recovered firmly to settle up near the 3% mark. We stated yesterday that the yen was not an ideal safe haven hedge. We believed that a rising dollar and tremendous technical resistance would keep gains capped. This is exactly what happened overnight and once stocks recovered from session lows, the Yen was set on a path towards unchanged. Tonight, there are minor data points out of Japan; Foreign Reserves at 5:50 pm Central, Average Cash Earnings and Overtime Pay at 6:00, Coincident Indicator and Leading Index at 11:00. Traders should keep an eye on the activity of the Dollar as well as stocks through Fed speak tomorrow.
Technicals: Price action settled right at our pivot level and the technical picture is very clear as the range is defined well by our major three-star support and resistance.
Session close: Settled at .7885, down 15 ticks
Fundamentals: The Aussie weakened last night on poor Retail Sales and Trade Balance data. The Reserve Bank of Australia left rates unchanged as expected and price action traded to a session low of .7834. The tape began to mirror global equity markets and as they recovered into this morning, so did the Aussie. While it settled negatively it worked higher into the electronic close on solid jobs data out of its neighboring New Zealand. The AIG Construction Index came in solid as well. The trade will be U.S. dollar dependent tomorrow but that will shift with Chinese Trade Balance data late.
Technicals: The tape has weakened significantly, and major three-star support will be key. Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.
Session close: Settled at .7990, down 8.5 ticks
Fundamentals: Economic data today came in weak with both Canadian Trade Balance and Ivey PMI missing the mark. Price action recovered from session lows after hitting a huge technical level but also as crude oil held $63. The U.S. Dollar Index lost significant ground late in the session and this was also supportive. Traders will eye crude’s EIA report Wednesday, global equity price action and Chinese data tomorrow night. Friday brings a big Canadian employment read.
Technicals: Price action essentially achieved the buy range and major three-star support today with a low of .79595.