OANDA Trading Update : All is calm in the Foggy Bottom | Daily Market Commentary with Stephen Innes
A sense of calm continues emanating in from the Foggy Bottom, all of which is helping risk sentiment along quite nicely, as there was little drama for markets from the 20 combined minute speeches from US President Donald Trump, House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer. Trump did not declare a national emergency, nor did he hint towards one, which might have been a fear before the speech. Instead, he arranged a meeting with the Congressional leaders to talk about the funding, which scheduled for tomorrow.
Australia November building approvals MoM is -9.1% versus -0.3% expected. The YoY number is -32.8% versus -24.8% expected. Which would typically be hugely negative as traders closely track that critical economic data, especially on the heels of yesterday, miss on trade balance?
However, commodity currencies are holding firm riding the wave sentiment from the positive buzz in US-China trade talks.
In a similar light, the CNH is hearing that Buzz loud and clear as the market moves all on this morning on the bullish CNH break of 6.85 which is also having a significant influence on the rest of EM Asia FX which is predictably rallying across the board.
Outside of the high beta currencies, it’s been another relative sea of calm in for G-10 in Asia but with risk sentiment bubbling over it seems only a matter of time before USDJPY breaks through 109.00. Positive risk sentiment couples with the market pricing out the delusional end of 2019 25 % probability of US rate cut, we could see the USDJPY push to 110 on follow through. Significant support comes in at 108.50
The Euro continues to trade in no man’s land, and for the record, I’m a buyer at 1.1400 and seller at 1.1500 if anyone needs a view !!
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Stephen Innes is the Head of Trading, at OANDA Asia Pacific.
Innes has a deep-seated knowledge of the G10 and Asian currencies and is regularly called upon by leading TV, radio and print publications to offer his informed views on the financial markets. He offers specific expertise in trading spot and forward FX, currency and interest rate futures, money market derivatives and precious metals.
This daily market commentary is powered by OANDA.