Market Review - 25/10/2016 23:10GMT
Dollar retreats broadly on profit taking after weak U.S. data
Although the greenback resumed its recent ascent against majority of its peers on Tuesday as speculations of a Federal Reserve rate hike continued to support the buck, release of weaker-than-expected U.S. consumer confidence triggered broad-based long liquidation in New York afternoon.
Versus the Japanese yen, the greenback traded with a firm bias in Asia and Europe before rising to a fresh 2-month peak at 104.87 in New York morning on dollar's broad-based strength. Later, price pared its gains and retreated to 104.12 on profit-taking.
The single currency traded sideways in Asia and briefly rose to 1.0894 on the release of upbeat German Ifo data, however, renewed selling there pressured the pair lower and price dropped to an intra-day low at 1.0851 in New York morning on dollar's strength before gaining to session high at 1.0904 in New York afternoon.
The Munich-based Ifo economic institute said its business climate index, based on a monthly survey of some 7,000 firms, rose to 110.5 in October from 109.5 in September.
The British pound also traded sideways in Asia and edged up to 1.2243 in European morning before tumbling to as low as 1.2082 in New York morning as renewed concerns over Brexit triggered a broad-based selling of sterling. Later, cable pared its losses and staged a short-covering rebound to 1.2207 on comments from Bank of England's Carney.
In other news, BoE's Carney said 'monetary policy has been the principle if not sole vehicle to provide stimulus to UK; monetary policy has in many respects been overburdened; welcome that gov't is signalling resetting of balance between monetary, fiscal n structural policy; risk premium wud be most prominent on ccy, also in gilt mkts n inflation expectations; mkts shud have reason to see risk premium on UK assets; lawmerks' comments on BoE policy have no eddect on how BoE discharges its responsibility; BoE will not change how it conducts monetary policy unless parliament changes its remit; stance of monetary policy has supported UK economy during diffcult period of adjustment; central bank operational independence has stood the test of time.'
On the data front, the Conference Board, a market research group, said its index of consumer confidence fell to 98.6 this month from a reading of 103.5 in September, whose figure was revised from a previously reported 104.1. Analysts had expected the index to drop to 101.0 in September.
Data to be released on Wednesday:
Australia CPI, Germany consumer sentiment, France consumer confidence, Italy retail sales, UK mortgage approvals, U.S. trade balance, services PMI and new home sales.
Trendsetter does not warrant or guarantee the accuracy, timeliness or completeness to its service or information contained therein. Trendsetter does not give, whatsoever, warranties, expressed or implied, to the results to be obtained by using its services or information it provided. Users are trading on their own risk and Trendsetter shall not be responsible under any circumstances for the consequences of such activities. Trendsetter and its affiliates, in no event, be liable to users or any third parties for any consequential damages, however arising, including but not limited to damages caused by negligence whether such damages were foreseen or unforeseen.
Recommended Content
Editors’ Picks
EUR/USD stays below 1.0800 after upbeat US data
EUR/USD stays under bearish pressure and trades slightly below 1.0800 in the American session on Thursday. The data from the US showed that the real GDP growth for the fourth quarter got revised higher to 3.4% from 3.2%, supporting the USD and weighing on the pair.
GBP/USD stays in daily range above 1.2600
GBP/USD fluctuates in a narrow channel above 1.2600 on Thursday. The better-than-expected Initial Jobless Claims data from the US and the upward revision to the Q4 GDP growth helps the USD stay resilient against its rivals and limits the pair's upside.
Gold clings to strong daily gains above $2,200
Gold retreats from daily highs but holds comfortably above $2,200 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays above 4.2% after upbeat US data and makes it difficult for XAU/USD to preserve its bullish momentum.
XRP price falls to $0.60 support as Ripple ruling doesn’t help Coinbase lawsuit against SEC
XRP programmatic sales ruling by Judge Torres was completely rejected by another US Court that ruled in favor of the SEC in a lawsuit against Coinbase.
Portfolio rebalancing and reflation trades emerge into Q2
Yesterday’s price action pointed at a possible end-of-quarter portfolio rebalancing as the session saw the laggards of the quarter like Apple and Tesla gain, and the stars like Microsoft and Nvidia retreat.