Selling Focus Turns to Euro as Dollar Digests Gains
As Dollar is digesting this week's yield supported rally today, selling focus is turning to Euro, in particular in crosses. Meanwhile, firmer overall risk sentiment is supporting commodity currencies and Sterling, with Aussie being the stronger one. Yen and Swiss Franc are generally softer on stable risk sentiment.
Technically, as...
Dollar Breaking Key Resistance Levels as Yields Hold Firm
Dollar retreats mildly in Asian session but remains the strongest one over the week. The rally in treasury yields appear to be taking a breather. But 10-year yield is holding firm above 1.54 handle, while 30-year yield is also above 2.0 handle. Canadian is following as the second strongest,...
EUR/USD Breaks Key Support as Dollar Rise Continues
Dollar is generally strong today, but buying focus is temporarily shifted from against Yen to Euro and Sterling. In particular, EUR/USD has taken out key support level at 1.1663. Overall markets are mixed though, with stocks recovering while treasury yields retreat. Yen and Swiss Franc are the stronger ones...
USD/JPY Pressing 110.6/7 as Treasury Yields Extend Rally
Dollar is currently the strongest one for the week so far, as helped by strong rally in treasury yields as well as pull back in stocks. Yen also stays week but the selling in crosses is cushioned by uncertain risk sentiment. Sterling is also soft with eyes on the...
Sterling Tumbles on Energy Worries, Rising Yields Supports Dollar
Sterling tumbles broadly today on increasing talks of energy shortages due to a post-Brexit shortage of truck drivers, as well as a halt to license testing during pandemic lockdowns. Mild risk aversion, which start in European markets, is also weighing down some commodity currencies. Nevertheless, there is little lift...
Yen Crosses Accelerating Upward on Persistent Rally in Treasury Yields
Strong rally in treasury yields is currently the main theme driving the markets. On the back on hawkish Fed rhetorics, 2-year yield rose to 18-month high, above 0.3%. Benchmark 10-year yield also breaks above 1.5% handle. Yen is currently the worst performing one, with persistent selling pressure. Euro and...
European Gas Price Triples amidst Supply Disruption and Rising Demand
European gas price has kept breaking new records over the past months. Both higher-than-usual demand and supply shortage have led to the price strength. As winter is approaching, we expect price to remain at elevated levels in the months to come.
The front-month Dutch TTF gas contract has remained firm...
Dollar Mildly Higher after Durable Goods Orders, Sterling Advancing in Crosses
Dollar trades mildly higher in early US session, lifted by stronger than expected durable goods orders data. But it's being overwhelmed by both Sterling and Aussie. Commodity currencies are firmer on "stable" market sentiment, but there is no follow through buy yet, including Canadian Dollar. On the other hand,...
Canadian Dollar Rises Together With Oil, Euro Shrugs German Election
Canadian Dollar leads commodity currencies higher in Asian session, with help from extended rally in oil price. Overall sentiment is mixed though and Yen is trying to pare back some of last week's losses. Some weakness in seen in both European majors and Dollar but movements in respective pairs...
Yen Dropped Broadly as Treasury Yields Jumped on Hawkish Fed
Yen's fortune reversed last week as US treasury yields accelerate up after hawkish FOMC meeting and projections. US stocks also display strong resilience and closed generally higher, reversing prior losses. Sterling, on the other hand, shrugged off hawkish BoE voting and ended as second weakest. Aussie and Kiwi were...
CFTC Commitments of Traders – Natural Gas Prices Soared on Shortage. Demand is Prone to Increase Further as Cold Weather Approaches
According to the CFTC Commitments of Traders report for the week ended September 21, NET LENGTH of crude oil futures added +914 contracts to 355 978. Bets on both sides fell with speculative longs and shorts down -6 263 contracts and -7 177 contracts, respectively. For refined oil products,...
CFTC Commitments of Traders – USD Supported by Tapering Hopes
As suggested in the CFTC Commitments of Traders report in the week ended September 21, NET LENGTH of USD index futures ADDED +827 contracts to 25 100. The Fed signaled that QE tapering would coon "soon" while half of the committee members projected that rate hike would come as...
Yen Dives as Market Sentiment Turned Bullish, USD/JPY Pressing 110.44 Resistance
Market sentiment took a big turn overnight with strong rally in US indexes. Nikkei follows in Asia and reclaimed 30k handle, but other Asian markets are soft. Yen dropped notably following return of risk appetite while Dollar also weakened. On the other hand, commodity currencies rebounded notably. Yen is...
BOE Downgraded Short-Term Growth, but Turned Slightly More Hawkish about Tightening
The BOE voted 9-0 to leave the Bank rate at 0.1% at the September meeting. The members voted 7-2 to keep the QE program at 895B pound. Deputy governor Dave Ramsden and external member Michael Saunders favored lowering the amount of asset purchase to 840B pound. Policymakers warned that...
Sterling Rebounds on Hawkish BoE Surprise, Risk Sentiments Improved
Sterling rebounds strongly after two BoE MPC member voted for tapering. Also, recent developments strengthened the case of modest tightening. Commodity currencies are also firmer following mild rebound in the stock markets. On the other hand, Yen, Swiss Franc and Dollar turned softer on improvement overall risk sentiment. But...
Markets Responded Positively to FOMC, Sterling Stays Soft ahead of BoE
Dollar initially dipped after FOMC overnight, but quickly found its footing. Overall market reaction was positive, but insufficient to alter the near term outlook. Sterling remains the worst performing one for the week while Swiss Franc is the strongest. Both will look into BoE and SNB policy decision today....
US Crude Oil Inventory Fell More than Expected, while Gasoline Stockpile Gained
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks fell -8.78 mmb to 1234.64 mmb in the week ended September 170. Crude oil inventory fell -3.48 mmb (consensus: -2.44 mmb) to 413.96 mmb. Stockpile fell in 4 out...
FOMC Review: Tapering will Start “Soon” while First Rate Hike may Come in as Soon as 2022
The Fed turned more hawkish in September, with the first rate hike pushed forward to 2022. Fed Chair Jerome Powell indicated that QE tapering will come “soon”. The staff downgraded the GDP growth forecast for this year, but revised higher that for 2022 and 2023. Inflation projections were revised...
Sterling Staying in Selloff Mode, Quiet Markets Await Fed
Trading in the forex markets is rather subdued today, as FOMC policy decision, dot plot and economic projections are awaited. The markets could come back to live if there are some hawkish twists in Fed's projections. For now, Sterling is staying in selloff mode, even though momentum diminished a...
Markets Turned Cautious ahead of FOMC, Hawkish Surprise Possible
Markets have turned quiet today as focus is shifted to FOMC policy decisions. While a tapering announcement is highly unlikely, there are still prospects of hawkish surprises in the dot plot and the economic projections. In the currency markets, Sterling is currently the worst performing one for the week,...