Markets are a weird beast sometimes and there is no better example this morning than the fact that the Aussie dollar has fallen after the RBNZ jacked up rates again – taking the OCR to 3.5% and RBNZ Governor Wheeler warned that the Kiwi’s strength was “unjustified”.
So even though AUDNZD is through the roof the Aussie is off about 20 pips from the highs around 5am at 0.9461.
I’m not normally one to quote myself because lets face it there is always an huge element of cherry picking by pundits when they do that. But yesterday’s set up we highlighted and the potential for a move to the range top was as obvious a convergence of fundamentals and technicals as you can get.
So what we see now is the very thing we expected – a test of the range top.
Key now is that unless or until the Aussie breaks up through 95 cents its still in a great big Darvasian box.
Anyway back to the overnight action and solid earnings helped propel the S&P 500 to a new all-time closing high of 1,987.09 up 3 for a gain of 0.17%. The Dow was down 0.16% however at 17,087 and the Nasdaq rose 0.4% to 4,474.
It seems you can’t kill this market with a stick but as former US Treasury Secretary Tim Geithner highlighted the complacency in markets is unsettling.
In Europe things were more positive as well with the DAX up 0.2% to 9,754, the CAC up 0.15% to 4,376 while the FTSE was up ever so slightly with a rise of 0.04% to 6,798. That’s not a bad performance given BoE Governor Mark Carney warned of higher rates and sooner rather than later overnight.
- Locally on the ASX futures market the SPI 200 was up sharply at 5542 for a gain of 19 points on the September contract. Yesterday the physical ASX200 rejected a very important trendline when it had a run at 5600 and a break of this level would be a huge move if it can happen.
Here is what the ASX looks like in vantageFX MT4 terms – close but no break yet.
In Asia yesterday the Nikkei dipped just 0.09% to 15,329, the exchange in Shanghai was up 3 points or 0.12% to 2,078 but Hong Kong stocks were higher with the Hang Seng rising 0.8%. Today is a big day for the region with the release of Japanese tade data along with the HSBC flash Chinese manufacturing PMI and its Japanese counterpart the Nomura/JMMA PMI.
On currency markets the Aussie’s bounce gained further traction topping out at 0.9461 before the RBNZ it is sitting at 0.9440. Euro’s weaker drift continued and it sits at 1.3460 while Sterling strangely also fell even with Carney’s warning – it sits at 1.7041. USDJPY is becalmed at 101.47.
On commodities iron ore tanked and has now given up 50% of its gains. It closed down $1.25 to $93.08 tonne. Newcastle coal for September was down a marginal 5 cents tonne at $68.40.
Nymex crude for August was up 73 cents Bbl to $103.79. Gold has drifted lower dropping $10 oz to $1,303 and copper is unchanged at $3.19 lb. Corn rose 0.62%, wheat is up 1.19% and soybeans rallied 1.44%.
On the data the Chinese and Japanese data are the key releases today in Asia then we head to Europe for the flash PMI’s and UK retail sales. In the US Markit also releases a flash PMI along with new home sales, jobless claims and the Kansas City Fed manufacturing index.
Greg McKenna
NB: Please note all references to rates above are approximate
To learn more about Greg McKenna, read on here.
So even though AUDNZD is through the roof the Aussie is off about 20 pips from the highs around 5am at 0.9461.
I’m not normally one to quote myself because lets face it there is always an huge element of cherry picking by pundits when they do that. But yesterday’s set up we highlighted and the potential for a move to the range top was as obvious a convergence of fundamentals and technicals as you can get.
So what we see now is the very thing we expected – a test of the range top.
Key now is that unless or until the Aussie breaks up through 95 cents its still in a great big Darvasian box.
Anyway back to the overnight action and solid earnings helped propel the S&P 500 to a new all-time closing high of 1,987.09 up 3 for a gain of 0.17%. The Dow was down 0.16% however at 17,087 and the Nasdaq rose 0.4% to 4,474.
It seems you can’t kill this market with a stick but as former US Treasury Secretary Tim Geithner highlighted the complacency in markets is unsettling.
In Europe things were more positive as well with the DAX up 0.2% to 9,754, the CAC up 0.15% to 4,376 while the FTSE was up ever so slightly with a rise of 0.04% to 6,798. That’s not a bad performance given BoE Governor Mark Carney warned of higher rates and sooner rather than later overnight.
- Locally on the ASX futures market the SPI 200 was up sharply at 5542 for a gain of 19 points on the September contract. Yesterday the physical ASX200 rejected a very important trendline when it had a run at 5600 and a break of this level would be a huge move if it can happen.
Here is what the ASX looks like in vantageFX MT4 terms – close but no break yet.
In Asia yesterday the Nikkei dipped just 0.09% to 15,329, the exchange in Shanghai was up 3 points or 0.12% to 2,078 but Hong Kong stocks were higher with the Hang Seng rising 0.8%. Today is a big day for the region with the release of Japanese tade data along with the HSBC flash Chinese manufacturing PMI and its Japanese counterpart the Nomura/JMMA PMI.
On currency markets the Aussie’s bounce gained further traction topping out at 0.9461 before the RBNZ it is sitting at 0.9440. Euro’s weaker drift continued and it sits at 1.3460 while Sterling strangely also fell even with Carney’s warning – it sits at 1.7041. USDJPY is becalmed at 101.47.
On commodities iron ore tanked and has now given up 50% of its gains. It closed down $1.25 to $93.08 tonne. Newcastle coal for September was down a marginal 5 cents tonne at $68.40.
Nymex crude for August was up 73 cents Bbl to $103.79. Gold has drifted lower dropping $10 oz to $1,303 and copper is unchanged at $3.19 lb. Corn rose 0.62%, wheat is up 1.19% and soybeans rallied 1.44%.
On the data the Chinese and Japanese data are the key releases today in Asia then we head to Europe for the flash PMI’s and UK retail sales. In the US Markit also releases a flash PMI along with new home sales, jobless claims and the Kansas City Fed manufacturing index.
Greg McKenna
NB: Please note all references to rates above are approximate
To learn more about Greg McKenna, read on here.
In addition to the website disclaimer below, the material on this page prepared by Vantage FX Pty Ltd does not contain a record of our prices or solicitation to trade. All opinions, news, research, tools, prices or other information is provided as general market commentary and marketing communication – not as investment advice. Consequently, any person acting on it does so entirely at their own risk. The expert writers express their personal opinions and will not assume any responsibility whatsoever for the forex trading account of the reader. We always aim for maximum accuracy and timeliness, and Vantage FX shall not be liable for any loss or damage, consequential or otherwise, which may arise from the use or reliance on this service and its content, inaccurate information or typos. No representation is being made that any results discussed within the report will be achieved, and past performance is not indicative of future performance.sary.
Recommended Content
Editors’ Picks
AUD/USD failed just ahead of the 200-day SMA
Finally, AUD/USD managed to break above the 0.6500 barrier on Wednesday, extending the weekly recovery, although its advance faltered just ahead of the 0.6530 region, where the key 200-day SMA sits.
EUR/USD met some decent resistance above 1.0700
EUR/USD remained unable to gather extra upside traction and surpass the 1.0700 hurdle in a convincing fashion on Wednesday, instead giving away part of the weekly gains against the backdrop of a decent bounce in the Dollar.
Gold keeps consolidating ahead of US first-tier figures
Gold finds it difficult to stage a rebound midweek following Monday's sharp decline but manages to hold above $2,300. The benchmark 10-year US Treasury bond yield stays in the green above 4.6% after US data, not allowing the pair to turn north.
Bitcoin price could be primed for correction as bearish activity grows near $66K area
Bitcoin (BTC) price managed to maintain a northbound trajectory after the April 20 halving, despite bold assertions by analysts that the event would be a “sell the news” situation. However, after four days of strength, the tables could be turning as a dark cloud now hovers above BTC price.
Bank of Japan's predicament: The BOJ is trapped
In this special edition of TradeGATEHub Live Trading, we're joined by guest speaker Tavi @TaviCosta, who shares his insights on the Bank of Japan's current predicament, stating, 'The BOJ is Trapped.'