Session close (Thursday, Feb. 16): Settled at 1.2530, up 67.5 ticks
Fundamentals: The euro traded to an overnight high of 1.25335 before retreating on weaker Trade Balance data. U.S. data was mixed with a beat on PPI and a miss on Industrial Production. The intraday low of 1.24805 held last night’s reopen and buyers resumed yesterday’s trend pushing the euro back to session highs upon settlement. European Central Bank heads Mersch, Praet and Lautenschläger didn’t move the meter much this morning. We expect a little more from Coeure tomorrow and the trend seems to be pointing to hawkish jargon. The euro is up 7.5% against the Dollar since November and yes this has raised quite a few eyebrows at the ECB, especially as U.S. politics came into the picture.
However, all currencies are up sharply against the Dollar, and the Pound/Euro is essentially flat during that time frame and the Euro/Yuan is rangebound since the rally into last August’s high (it did just double bottom and is up 3% on the week to retest that August high). The point here is that though the ECB is concerned about the euro/U.S. dollar (Euro/USD) currency pair, it is not a dire situation where the Euro has appreciated against other currencies in the same manner. Because of this, we expect to see that hawkish jargon from ECB heads. From the United States Building Permits and Housing Starts are due at 7:30 a.m. Central and Michigan Consumer Sentiment is at 9:00.
Technicals: Price action finished the session out above our key resistance at 1.2508-1.2514 which also aligned with a trend line from the highs. 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 .9427, up 70.5 ticks
Fundamentals: The Yen continued its bullish run even as equity markets notched a remarkable session with the S&P 500 gaining more than 1%. Asian markets paused their drop today and volume is likely to be light due to the Lunar New Year. The Yen strength is nearing a place where we would not be surprised to see officials from the Bank of Japan verbally intervene. For now, U.S. dollar weakness along with speculation that the BoJ will continue tapering stimulus measures as the year unfolds is driving price action. Data on Foreign Buying is due tonight at 5:50 p.m. Central.
Technicals: Price action continues to surge, and we have now upped resistance to a major four-star level. 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 .7934, up 22 ticks
Fundamentals: The Aussie punched higher last night on momentum but also a solid read on Employment Change data. Like most U.S. dollar-denominated assets, the Aussie retreated through the first half of the day session but quickly bottomed heading into the afternoon as the U.S Dollar weakened once again. RBA Governor Lowe speaks tonight at 5:30 p.m. Central. Motor Vehicle Sales data is due at 6:30 p.m. Central. Look for U.S. data to push the tape tomorrow.
Technicals: Today’s price action played out extremely technical and is a great reminder of how the levels work. Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.
Canadian dollar (March)
Session close: Settled at .8009, up 19.5 ticks
Fundamentals: The Canadian had a quiet but solid session seeing strength from a weaker U.S. dollar and a solid read on ADP Nonfarm Employment. This data showed an increase of 10,700 jobs and helps relieve the dismal part-time job loss seen in the government data last week. Bank of Canada Deputy Governor Schembri spoke with a balanced tone on being cautious on the next rate hike but how inflation pressures are real. Tomorrow we look to Manufacturing Sales and Foreign Securities Purchases at 7:30 a.m. Central.
Technicals: The technicals likely held the Canadian back from further gains. Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.