Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Greenback Regains Strength

ByAxi
AuthorAxi
Published 09/01/2019, 01:53 pm
Updated 06/07/2021, 05:05 pm

Originally published by AxiTrader

London/NY Wrap:

* Lack of relevant data releases led to a choppy trading session, with equity markets giving up some of the gains from Tuesday morning
* Traders remain focused on the trade talks between the US and China, and are awaiting updates on the progress
* German Industrial Production disappointed; IP declined 1.9 percent in November, while the market was expecting an increase of 0.3 percent
* Canadian trade figures showed a larger deficit than anticipated; 2,06bln Canadian dollar vs. 1,95bln Canadian dollar expected

FX:

The US dollar regained some strength during the NY session. However, this was mostly driven by the weakness in other major currencies rather than bullish US dollar developments. The euro came under pressure following another weak economic data release out of Germany, while the on-going Brexit drama continues to weigh on the British pound. The debate ahead of the Parliament vote (Jan 15) will start on Thursday, and traders should expect a sharp increase in volatility.

The key levels to watch in cable are 1.2820-1.2850 to the topside (an area of strong support/resistance in the past) and 1.2650/60 to the downside.

GBP/USD

AUD/USD and NZD/USD both traded in rather tight ranges on Tuesday. The light economic calendar means that the direction of the Australian dollar and New Zealand dollar are likely to be determined by the trade talks and general risk appetite in the market.

USD/CAD struggled however, despite the broad dollar strength. Rising Oil prices are keeping the Canadian dollar bid. The currency pair is now approaching a key support level at 1.3225 - which is the 50 % Fibo of the October - December rally. A clear break below that level could lead to greater selling pressure.

USD/CAD

The Session Ahead:

* No relevant economic data will be released during the upcoming APAC session
* The focus will be on the speech by US President Trump at 0200 GMT (1300 Sydney / 1000 Singapore). The main topic of his speech will likely be the US Government shutdown. However, he could use the opportunity to update the markets on the on-going trade talks in Beijing.
* The market is looking for positive signals. Should Trump indicate that the talks are going well, risk assets are likely to benefit, while the Japanese Yen and Swiss Franc could suffer.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.