FX Market Udate.

 USD mixed vs. G10 peers JPY underperforming and CHF outperforming.
 CAD quiet trading at upper end of two week range risk in high-level U.S. data.
 EUR remains broadly range bound gains muted & appear corrective.
 GBP eases on dovish BoE comments, charts look toppish  
 USDJPY climbs to fresh July high sentiment and positioning are dominant.
 USDCNY dips, CNY gains broadly on firm activity data  
FX Market Udate.
The USD mixed in a very mixed looking session overall so far. Asian equity markets were firmer after China posted generally better than expected 2 growth and activity data for June but European markets are broadly lower following another shocking terror incident in France. The USD is mixed overall, with the CHF out-performing while the JPY is mostly under-performing on the day, suggesting no clear move to safety in the FX space. The JPY is seeing its largest 1week fall since 1999, according to Bloomberg.
Similarly, the second best-performing currency on the session is the AUD while the NZD has lost most ground overall versus its G-10 counterparts, suggesting no strong appetite for risk. Developed market bonds are mostly lower on the day, as are crude oil prices and precious metals.
The market seems to be lacking a clear sense of direction across a broad front today. US data releases  CPI, retail sales, U. Michigan confidence data   represent the first top-tier reports since the NFP data last week and decent data (US numbers appear to be running a little hotter than consensus currently) should be USD supportive perhaps help establish a better tone for markets.
The CNY rose against the USD and its basket on better than expected 2 GDP growth (+6.7%, versus 6.6% in 1 and 6.6% expected) while retail sales rose 10.6% in the year (consensus +9.9%) and industrial production rose 6.2% (5.9% y/y expected). Aggregate loan activity was significantly stronger as well. The data will help ease worries about slowing growth momentum in China officials expressed confidence that the economy remains on track.
The EUR remains broadly range-bound, with price action suggesting little market reaction to the Bastille Day terror attack in the south of France. However, the incident may have repercussions on French (and perhaps European) growth (via confidence), budget balances (extra security spending) and politics (considering the ongoing fallout from Brexit and the looming French presidential election in 2017), our European economist notes.
EURUSD short-term technicals neutralbearishWe maintain a cautious view of EURUSD from a technical perspective. The market is grinding higher after the late June dip to near 1.09 still but gains are relatively muted and appear corrective, ahead of another push lower. Intraday price action looks soft after the overnight rejection of 1.1160. We see firm resistance at 1.1160/70 and 1.1190/95. Support is 1.1120.
Cable’s rebound after Thursday’s BoE surprise on hold’ decision extended to the upper 1.34 area in the overnight session before the market eased back through late morning European trade. BoE economist Haldane released the text of a June 30th speech, updated to reflect his current views, suggesting a “prompt” and “muscular” policy response in August will likely be required to protect the economy from Brexit fall out. The message is not too surprising and suggests an aggressive move is likely next month. It does, however, add to the mystery of why the BoE did not go yesterday.
GBPUSD The post-Brexit bounce in the GBP may, finally  really, this time  be running out of momentum.  The move up off the early July low has struggled around the 1.3337 23.6% Fib retracement of the 1.50/1.28 sell off and short-term price signals today suggest renewed selling pressure is making an impact on price trends.  Hourly signals have seen two bearish outside ranges in the past few hours and the daily chart suggests a potential bearish doji candle signal.  We look for weakness to extend below 1.3225.
JPY is soft and underperforming, down 0.4% following a modest recovery from its near-1% decline observed through the early part of Friday’s Asian trading session. Sentiment and positioning are dominant, as we note a second consecutive session of divergence from levels implied by yield spreads. Risk reversals are also diverging across time horizons as shorter-term measures imply a rise in the premium for protection against JPY strength while longer-term measures continue their moderate postBrexit fade. We continue to highlight extended bullish CFTC positioning as a key risk for JPY, the largest held net long vs. the USD with a 7.8bn position as of July 5th. Domestic risk continues to center on the prospect of stimulus, both fiscal and monetary, with a focus on fiscal details set for release around the end of July. The next BoJ meeting is scheduled for July 29 and is currently the subject of considerable speculation with regards to the range of policy options.
USDPY  has rallied to a fresh July high, testing its 50 day MA (106.32) for the first time since early February. Momentum signals are bullish and the RSI is at 57, well below the overbought threshold at 70. USDJPY has marginally broken the June 24 open at 106.16 and its test of the 50 day MA opens up the risk to further gains toward the 100 day MA at 108.62.
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