The BoJ is Running out of Firepower [Video]

Frank Walbaum FX Strategies.Asia

Are Global Stock Markets Correcting?

Stocks slipped from record levels on Wednesday as Wall Street digested a set of mixed corporate earnings data, while markets in Asia are headed for a mixed close this morning. Global stocks may be in for a correction today as market participants digest fresh earnings. In Europe, stock markets opened slightly lower on Thursday morning, as market participants monitored another deluge of corporate earnings. As major bourses appear to be correcting from their recent rally, we could be seeing a shift in risk towards safe haven trades very soon.

BoJ Running out of Firepower

The Japanese Central Bank revised its inflation forecast down, but market participants seem reluctant to sell the Yen further. The BoJ appears to have run out of ways to weaken the Yen further, with the latest monetary policy meeting not having a significant effect on the safe haven currency.

Forex Preview: Dollar Stabilises

In today’s forex markets the The USD has gained much momentum and could pause for the day to stand its ground. It should be noted that the USD has rallied to a 23-month high of 98.189 against a basket of key rivals overnight. We see the Greenback at current levels as stable. Meanwhile, the Canadian dollar remained subdued after the Bank of Canada left interest rates unchanged as anticipated. The euro steadied against the dollar this morning after renewed Germany growth concerns drove the EUR/USD to a 22-month low overnight. If stock markets continue to dip and the risk off tone prevails, we would expect major safe havens such as gold, CHF and the JPY to edge higher.

Deutsche Bank Hands Trump’s Loans Paperwork

Deutsche Bank has begun providing financial records to New York state's attorney general in response to a subpoena for documents related to loans made to President Donald Trump and his business. The subpoenas involve records tied to funding for several Trump Organization projects with Trump having allegedly inflated his assets. It is also important to note that the bank is already the subject of a joint investigation between the House Financial Services and Intelligence committees into Trump's businesses and money laundering. DBKGn shares have recovered some of yesterday’s losses on Thursday but we would keep an eye on this story and watch for any major developments.

Author

Frank Walbaum

FX Strategies.Asia

Frank has been working in the TV business for several years. Acquiring his skills in Germany’s biggest broadcasting station, he then chose to work and live in Asia, which was in 2007.

EUR/USD tests nine-day EMA support near 1.1850

EUR/USD remains in the negative territory for the fourth successive session, trading around 1.1870 during the Asian hours on Friday. The 14-day Relative Strength Index momentum indicator at 56 stays above the midline, confirming steady momentum. RSI has eased but remains above 50, indicating momentum remains constructive for the bulls.

GBP/USD consolidates around 1.3600 vs. USD; looks to US CPI for fresh impetus

The GBP/USD pair remains on the defensive through the Asian session on Friday, though it lacks bearish conviction and holds above the 1.3600 mark as traders await the release of the US consumer inflation figures before placing directional bets.

Gold recovers swiftly from weekly low, climbs back closer to $5,000 ahead of US CPI

Gold regains positive traction during the Asian session on Friday and recovers a part of the previous day's heavy losses to the $4,878-4,877 region, or the weekly low. The commodity has now moved back closer to the $5,000 psychological mark as traders keenly await the release of the US consumer inflation figures for more cues about the Federal Reserve's policy path.