Asia Shrugs US Stock Rebound Again, Some Dollar Weakness Before Year End
Despite initial setback, US equities extended the post-Christmas historic rebound overnight. DOW ended up 1.14% to 23138.82. S&P 500 rose 0.86% and NASDAQ added 0.38%. But the improvement in sentiments isn't carried over to Asian session. Nikkei is currently down -0.39%. Hong Hong HSI is just up 0.09% while...
FX 2019 – USD Peaks, But Not Necessarily Sharply Lower
The consensus forecast that USD’s rally, which began in February this year, is coming to an end hinges on the theses of overvaluation and stretched FX market longs, the slowdown in US economic growth and the end of current tightening cycle. While we are also of the view that...
Yen and Swiss Franc Higher as Sentiments Turn Sour Again
While the US markets staged an historic comeback yesterday, sentiments didn't stay long. After Asian markets turned mixed, European markets are now trading broadly lower. DOW's over 1000pts rebound yesterday was impressive. But futures suggest that it's going to give back 300pts or more at open. Swiss Franc and...
No Follow Through in Risk Appetite after US Stocks Rebound
US equities staged a impressive rebound overnight and that's actually the strongest since 2009. DOW closed up 4.98% or 1086.25 pts at 22878.45. S&P 500 rose 4.96% to 2467.70. NASDAQ jumped even more by 5.84% to 6554.36. Reactions in Asia were mixed though. Nikkei closed up 3.88% to 20077.62,...
China’s Monetary Policy Outlook in 2019 – Easing While Refusing to Admit So
Ongoing trade war with the US is accelerating the slowdown in growth in China. As such, the monetary policy adopted by PBOC would continue to be accommodative. Echoing the rhetoric of the annual Central Economic Work Conference, PBOC affirmed that its policy for the coming year would remain “prudent...
Subdued Holiday Trading Continues, Yen and Swiss Franc Pare Gains
The forex markets are generally rather quite today as most major countries remained on holiday. After another day of free fall on Monday, US stocks futures point to higher open. DOW could recover by triple-digit but the sustainability of the rebound is questionable.
There is no end in sight on...
Yen and Swiss Franc Strong as US Stocks Extend Plunge, Trump Urges to Buy Dip
Yen and Swiss Franc are so far the strongest ones for this holiday week. But trading is rather subdued in Asia, as part of the region are still on holiday. Activity will likely remain low in European session with Germany, UK and Swiss on holiday today. The markets might...
CFTC Commitments of Traders – Bets on USD Trimmed amid Speculations of Slower Rate Hike Path in 2019
As suggested in the CFTC Commitments of Traders report in the week ended December 18, NET LENGTH in USD Index dropped as bets decreased on both sides. All other major currencies stayed in NET SHORT positions. During the week, the greenback was mixed against major currencies. Expectations of a...
CFTC Commitments of Traders- Bets on Crude Oil Fell Amid Price Slump
According to the CFTC Commitments of Traders report for the week ended December 18, NET LENGTH for crude oil futures climbed modestly higher as the decline in speculative short positions outweighed that in long positions. NET LENGTH added +102 contracts to 309 608 contracts for the week. Both crude...
Stock Markets Correcting 10-Year Up Trend But Fed’s Not to Blame
The global stock markets just turned from bad to worse last week. DOW suffered its worst week since the global financial crisis back in 2008, down the week by nearly -7%. S&P 500, down the month by -11.4%, is also on track to have its worst week since 1931,...
Risk Aversion Eased ahead of Holiday, But Yen Remains Strongest
Yen remains the strongest one for today even though risk aversion eased a bit ahead of long holiday weekend. Dollar is following as the second strongest, reversing a lot of post FOMC losses against Euro and Swiss Franc. Commodity currencies remain generally weak. But today, it's Canadian Dollar that's...
DOW Dropped to Critical Fib Level, Yield Curve Flattened Further
While risk aversion continued in Asian session, volatility cooled mildly. Major pairs and crosses are staying in relatively tight range. Swiss Franc and Sterling are generally higher while commodity currencies are soft. But the picture for the day could easily change. For the week, dusts have little settled. Yen...
Dollar Under Pressure But Loss Limited, BoE Dovish Shift Ignored
Dollar remains in the spotlight today as it suffers renewed selling in European session. It could be part of delayed reaction to the dovish FOMC rate hike yesterday. But then, while the greenback is the worst performing one today, loss greenback is limited so far except versus the Japanese...
BOE Turns Dovish as Brexit Deadline Nears, Yet No Deal is Secured
BOE voted 9-0 to leave the Bank rate unchanged at 0.75% in December. The committee also voted unanimously to leave the asset purchase program at 435B pound .It has turned more cautious than November, warning that Brexit uncertainty has “intensified considerably” since November. Thanks to lower oil prices, policymakers...
Yen Surges as Markets Tumble on Insufficiently Dovish Fed
US stocks tumbled overnight, extending recent decline, as FOMC raised interest rate and the overall announce was less dovish than expected. Risk aversion also spread to Asian session. Commodity currencies are generally pressured as a result. New Zealand Dollar additionally weighed down by poor GDP while Aussie is soft...
FOMC Review – Fed Not As Dovish As Expected
The December FOMC meeting outcome is expected, yet unexpected. As widely anticipated, it raised the policy rate, by +25 bps, to 2.25-2.5%. The IOER rate was raised by +20bps. The members trimmed the rate hike forecasts to two, form three, for September. They remained upbeat about economic outlook, but...
Oil Fundamentals Remain Fragile Despite OPEC+ Cut. Saudi’s Over-Optimistic Budget Reinforces Oversupply Worries
The deal made by OPEC+ to cut output had only limited boost the oil prices. The renewed selloff in crude oil prices, indicating another leg of downturn, is driven by concerns over global growth slowdown, decline in stock markets and Saudi Arabia's budget plan. US' weekly report showed less-than-expected...
Euro Surges as EU Finally Approved Italian Budget, Dollar Mixed Awaiting FOMC Guidance
Euro rises broadly today as Italy finally got its 2019 budget plan approved by the European Commission. Disciplinary actions are now avoided. Italian 10-yield yields tumbles sharply and is pressing September's low. For now, Yen follows as the second strongest. Canadian Dollar is recovering today as oil prices turned...
Dollar in Range ahead of FOMC, Preparing for Breakout
Dollar is mildly softer in Asian session as traders turn cautious ahead of FOMC rate decision. But it should be noted that, except versus less, and to a lesser extent Swiss Franc, Dollar isn't that weak. EUR/USD, GBP/USD and AUD/USD are bounded in consolidation in familiar range. USD/CAD has...
Dollar Declines as Trump Urged Fed to Feel the Markets, But Loss Limited as Traders Await Projection Numbers
Dollar selloff takes center stage today as Trump continues with his verbal intervention on Fed policy. But Canadian Dollar is even weakest as down trend in WTI crude oil extends. Swiss Franc is for now the third worst performing one. On the other hand, New Zealand Dollar recovers as...