Risk was indeed back on in the NY session as not even some pretty downbeat economic data could keep equities down. The S&P jumped +1% on the day and managed to close back above the psychologically important 850 mark. Gold managed to remain bid and closed right at the bottom of the Ichimoku cloud, which sits at 904.45. It looks like we still need a daily close above here to see this rally extend in size.
On the economic front, US data continued to print weak while Canadian news improved. US continuing claims jumped to a higher than expected 6.14 million from 6.04 while existing home sales slumped -3.0% in March to just 4.57 million annualized units (also well below the market forecast). On the flipside, Canadian retail sales jumped 0.2% on the month, beating estimates for a -0.3% decline. Also, the Bank of Canada Monetary Policy Report noted ''surprisingly strong'' household borrowing and improved financial conditions. The bank also announced that at this time it will not seek to implement quantitative easing.
USD/CAD was one of the bigger movers on the back of the news. Loonie sank -120 pips and was sitting just above the 200hr SMA (1.2225) at the close. Below opens up potential to 1.2180, which is a 61.8% Fibonacci retracement from the 1.1975 to 1.2508 upmove. The pair needs to get back above 1.2320 to shift the focus higher. EUR/USD extended gains on the rally in risk and jumped 90 pips to 1.3140/45. EUR/JPY popped 50 pips to 128.75/80 and this left USD/JPY lower by -30 points into the 97.90/95 zone. Important daily trendline support for USD/JPY lurks near 97.60 and below has the 55-day SMA currently at 97.04 on the follow.
Upcoming Economic Data Releases (Asia Session) expected prior
- 4/23 23:50 GMT JN Corp Service Price (YoY) MAR -2.60% -2.60%
- 4/23 23:50 GMT JN All Industry Activity Index (MoM) FEB -2.10% -1.70%
