Year End Positions Flows Dominating Market
U.S. Dollar Trading (USD) had a volatile and mixed trading session in thin liquidity with year end flows dominating and often confusing traders. Normal relationships broke down with GBP falling whilst the Euro rallied and the Aussie came under broad profit taking pressure. Weekly Jobless Claims fell below 400k to 388k in promising signs that the US job market was picking up. In US stocks, DJIA -15 points closing at 11569, S&P -2 points closing at 1257 and NASDAQ -4 points closing at 2662.
The Euro (EUR) The Euro managed solid gains breaking to multi week highs above 1.3300. EUR/GBP also moved higher as the two majors diverged paths. EUR/USD traded with a low of 1.3218 and a high of 1.3317 before closing at 1.3300. Looking ahead, German Bank Holiday.
The Japanese Yen (JPY) was calm in a 40 pip range stabilizing the recent fall with most of the movement reserved for crosses. EUR/JPY reclaimed Y108 with the major moving higher. Overall the USDJPY traded with a low of 81.27 and a high of 81.88 before closing the day around 81.50 in the New York session.
The Sterling (GBP) fell sharply from above 1.5500 to 1.5360 as widespread GBP selling was noted on many crosses. Overall the GBP/USD traded with a low of 1.5365 and a high of 1.5539 before closing the day at 1.5430 in the New York session. Looking ahead, Nationwide HP forecast -0.3% m/m.
The Australian Dollar (AUD) tested 1.0200 before falling on a combination of year-end profit taking and weak Chinese PMI data 54.4 vs. 55.3 previously. Support was found at 1.0140 and the pair finished on a firm footing. Overall the AUD/USD traded with a low of 1.0117 and a high of 1.0200 before closing the US session at 1.0170.
Oil & Gold (XAU) Mild profit taking pulled the precious metal back towards $1400. Overall trading with a low of USD$1402 and high of USD $1415 before ending the New York session at USD$1407 an ounce. Oil pulled back substantially on heavy year end profit taking back to below $90 a barrel. WTI Oil Closed -$1.60 at $89.50 a barrel. |
