FX Market Skittish Before ECB
Original Article from ACM – Newsletter
The rally in risk appetite boosted by strong Chinese and Australian data yesterday was further encouraged after our last article by stronger than expected US ISM numbers. Forex risk correlated currencies, such as the Euro, moved lock-in-step with the data. EURUSD rallied above 1.2800 and the S&P climb above 1080. However, US rates weren’t invited to the party as players remained unsure – 10…
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Chinese & Australian Data Supports Risk Appetite
Original Article from ACM – Newsletter
The better than expected Chinese PMI and Australian GDP gave risk appetite a boost and allowed for the accumulation of risk-correlated trades. However, our gut feeling is that the summer risk on/off pattern is still in effect and we suspect the Asian momentum will fade as we get a slew of economic data today. The Asian surprise print help momentarily suspend the market’s obsession with global…
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Looking Forward to US Data
Original Article from ACM – Newsletter
With the UK on a long weekend yesterday, Forex traders had a slight pause in what has been a frenzied month. Enjoy it while you can, because September is notorious for being a volatile month and especially in the equity markets. This summer will be remembered (or maybe not) for its schizophrenic trading and a failure to maintain any meaningful directions or themes. This morning there is a…
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BoJ Action Fails to Halt JPY Appreciation
Original Article from ACM – Newsletter
Before we get into this week, let’s quickly talk about Jackson Hole. Right now it seems that the Market is just a few steps ahead of policymakers as there is growing feeling that central banks and bankers lack the essential tools needed to control this recovery. The decisions from this small group over the past few months all appear to be knee-jerk reactions – never intelligent stewardship or…
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FX Markets Wait for Wyoming
Original Article from ACM – Newsletter
An uncanny tranquility has spread over the Forex Market this morning. There was a feeling leaving the office yesterday that renewed fears of a global double-dip recession and sovereign risks were going to spiral out of control. However, US equity markets managed to close in positive territory while bond yields were mixed. During the Asian session, regional equity market indexes were able to…
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Markets Await Chairman Bernanke & US GDP Data
Original Article from ACM – Newsletter
Forex Markets are still peacefully trading in ranges as participant await US GDP and any news from Wyoming. Sentiment is stable with Asian regional indexes marginally higher helped by yesterday’s slight positive surprise in US jobless claims. FX volumes are contained especially within leveraged circles, hinting that retail traders may be sitting this week out due to enormous event risk and heavy…
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FX Moves Defined By Safe Haven Flows
Original Article from ACM – Newsletter
Risk-correlated trades fell hard yesterday as worries over the US economy reverberated through the market’s psyche. The core driver was the collapse of existing home sales which fell to a startling -27.2% and the June figure was revised down to -7.1%. US 10 yr yields broke the critical 2.50% level, while the 2 yr yields traded to new, all- time lows. Chicago Fed President Evans lamented the US…
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Noda Fails to Halt Yen Buying
Original Article from ACM – Newsletter
The recent void in fresh data was quickly eclipsed by a frenzy in JPY and USD buying which pushed USDJPY down to a 15 year low at 84.58 (at time of writing) and EURJPY below its Fibonacci level at 106.30. Remember the market importance of the Australian election? Neither do we. USDJPY falling below the 85.00 threshold most likely triggered model-based stops and options barriers around the 84.75…
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Waiting for US Data to Help Provide Guidance
Original Article from ACM – Newsletter
Forex traders were welcomed this week by a market filled with noise but little new information to provide any guidance. The Australian election was the main event over the weekend and the result produced a hung parliament since neither party gained the critical number of 76 seats for a majority. The Labour party took 72 seats and the coalition 70. The vast majority of pundits are harping on the…
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Lack of Data Puts Focus on Equity Markets
Original Article from ACM – Newsletter
Yesterday’s soft US data hit risk sentiment like a cannonball. Although the day was generally slow due to light data releases, the weaker US data sent summer participants away from risk-correlated trades in droves. Initial US jobless claims contained some distortions that were not mentioned in the report but as it was understood by participants, the 500k print validated to some that the US labor…
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