The New York session saw the greenback trade with a firm tone all day.  It made back a good portion of the losses it sustained yesterday.  We saw EURUSD sell off from the 1.4725 area down to the 1.4650 area. USDJPY ran up nearly 1 full yen as it moved from the 110.75 area to test near 111.80. USDCAD was firm most of the day as well. It traded from the .9525 area up to test near .9665. Most of this strength can be attributed to the US Retails Sales data coming in slightly better than expected while PPI data came in slightly less than expected.  The biggest gains for the dollar came against the British Pound.  GBPUSD continued its carnage from overnight.  The NY session saw it trade from the 2.0735 area down to the 2.0540/45 area.  The GBP got punished severely after an overnight Bank of England Inflation report was taken as dovish by the market.  GBP managed to lose ground against most major currencies today as the market is thinking that the economy in the UK may be slowing.

The dollar made some nice gains today but was unable to make back all the losses it sustained since the beginning of the week.  The market may not want to get too aggressive in buying dollars as there are some chunky data releases due out. Tomorrow we get CPI, Jobless Claims, Empire Manufacturing and Philly Fed.  Friday brings us TIC data and Industrial Production.  These releases could severely jolt the markets should they significantly surprise to either side of expectations. With recent volatility already at a premium, any surprises thrown the markets way will surely increase that volatility.  This will in turn make for fast movements in the currency markets and present the focused trader with multiple opportunities to trade.

Upcoming Economic Data Releases

  • 21:45 GMT New Zealand Retails Sales (MoM) for September; Expect +0.5% vs. prior +0.2% (relevance: high)
  • 23:30 GMT Australian Consumer Inflation Expectations for Nov. No survey, prior was 14.3% (relevance: medium)
  • 23:50 Japanese Tertiary Industry Index (MoM) for Sept.; Expect -1.0% vs. prior +0.2 %( relevance: high)
  • 00:30 GMT Australian Average Weekly Wages for Aug. (QoQ); No survey, Prior 1.7 %( relevance: medium)
  • 00:30 GMT Australian Average Weekly Wages for Aug (YoY); No survey, Prior 4.6 %( relevance: medium)