Today has been a day of USD strength, with the DXY spending the session firmly in the green and making a break above the 100DMA at 96.31. The USD was bolstered early in the session by EUR weakness, with participants remaining uncertain as to the future of the single currency as the threat of a Grexit continues to loom. EUR weakness was seen as European traders came to their desk and reacted to last night’s decision by the ECB to adjust the haircuts on collateral accepted by the Bank of Greece for the ELA. The saga continued today with source comments initially suggesting that a proposal was not going to be provided to the Eurogroup today, with later sources noting that an oral presentation was given, with the written proposal to be provided tomorrow.
Away from Brussels and the lack of a Greek deal, USD was further supported by this afternoons US data, with Trade Balance showing a smaller than anticipated deficit (-41.87bln vs. Exp. -42.70bln) and market participants looking ahead to tomorrow’s Fed minutes release, with focus to be on the debate surrounding the timing of rate lift-off. Of note, Bank of America analysts note that short USD positioning by HF and RM accounts is close to matching last years highs, highlighting the scope for long USD positions to increase.
Finally, commodity currencies were also seen weaker across the board with the focus on the growing concerns over the economic slowdown in China, as the PBoC and other regulatory bodies continue to try to prop-up the stock market. This has seen Palladium, platinum, copper and iron ore all trade at multi-month lows, with WTI yesterday seeing its largest drop since February and Brent and WTI crude futures residing below the USD 56.00 and USD 51.00 handles respectively.
Looking ahead, tomorrow sees a light calendar in terms of data, with the aforementioned FOMC minutes and ongoing Greek situation likely to remain in the spotlight. Also of note, comments are expected from Fed’s Williams, ECB’s Nowotny, Noyer and Coeure as well as UK Chancellor Osborne’s Budget Statement.
Away from Brussels and the lack of a Greek deal, USD was further supported by this afternoons US data, with Trade Balance showing a smaller than anticipated deficit (-41.87bln vs. Exp. -42.70bln) and market participants looking ahead to tomorrow’s Fed minutes release, with focus to be on the debate surrounding the timing of rate lift-off. Of note, Bank of America analysts note that short USD positioning by HF and RM accounts is close to matching last years highs, highlighting the scope for long USD positions to increase.
Finally, commodity currencies were also seen weaker across the board with the focus on the growing concerns over the economic slowdown in China, as the PBoC and other regulatory bodies continue to try to prop-up the stock market. This has seen Palladium, platinum, copper and iron ore all trade at multi-month lows, with WTI yesterday seeing its largest drop since February and Brent and WTI crude futures residing below the USD 56.00 and USD 51.00 handles respectively.
Looking ahead, tomorrow sees a light calendar in terms of data, with the aforementioned FOMC minutes and ongoing Greek situation likely to remain in the spotlight. Also of note, comments are expected from Fed’s Williams, ECB’s Nowotny, Noyer and Coeure as well as UK Chancellor Osborne’s Budget Statement.
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EUR/USD holds above 1.0700 after US data
EUR/USD struggles to build on Wednesday's gains and fluctuates in a tight channel near 1.0700 on Thursday. The data from the US showed that weekly Jobless Claims held steady at 208,000, helping the USD hold its ground and limiting the pair's upside.
GBP/USD fluctuates above 1.2500 following Wednesday's rebound
GBP/USD stays in a consolidation phase slightly above 1.2500 on Thursday after closing in the green on Wednesday. A mixed market mood caps the GBP/USD upside after Unit Labor Costs and weekly Jobless Claims data from the US.
Gold retreats to $2,300 despite falling US yields
Gold stays under bearish pressure and trades deep in negative territory at around $2,300 on Thursday. The benchmark 10-year US Treasury bond edges lower following the Fed's policy decisions but XAU/USD struggles to find a foothold.
Top 3 Price Prediction BTC, ETH, XRP: Altcoins to pump once BTC bottoms out, slow grind up for now
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Happy Apple day
Apple is due to report Q1 results today after the bell. Expectations are soft given that Apple’s Chinese business got a major hit in Q1 as competitors increased their market share against the giant Apple.