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It was a roller coaster ride for the dollar yesterday as the dollar continued its recent free fall from Wednesday evening, but as news filtered through that the US tax reform bill will pass the Senate – the dollar staged a fightback. Late last night though, we started seeing news that debate over the bill is going to spill into Friday and so it will be all eyes this morning – factor in a certain NFP data read today and we have the potential for another bout of volatility.
I have found the USDJPY a very interesting this week, the continued break in US bond yields has weighed heavily on the JPY and the pair managed to break first resistance at 112.30. The pair has topped out at 112.70 but has met with a lot of sellers at these levels, this also represents a major moving average. It might be a good battle here this morning and 112.70 may become a line in the sand, a move above becomes very bullish – but I feel that after such a strong week, the sellers may prevail this battle.
The USDCAD was rather choppy on the back of both this news as well as the OPEC meetings weighing on the Loonie. This pair has been on a rampage this week but finally found some resistance at 1.2914 late last night, the favourable measures by OPEC should buoy the CAD though today and so the first level of support at 1.2830 must be on the cards today. Keep in mind that we have big news flow coming out in both the CAD and USD.
Technically speaking, all the major pairs are on the table today – but you never knows what happens on NFP day.
Market Insight Commentary – Forex
In the Zone
- EURUSD
- GBPUSD
- AUDUSD
- NZDUSD
- USDCAD
- USDJPY
Market Insight Commentary – Indices
Important Economic Data out today
11:30 GBP Manufacturing PMI
Consensus: 56.6
Effect: Actual higher than expected is good for the GBP
15:30 CAD Employment Change
Consensus: 10.2K
Effect: Actual higher than expected is good for the CAD
15:30 CAD GDP
Consensus: 0.1%
Effect: Actual higher than expected is good for the CAD
15:30 CAD Unemployment Rate
Consensus: 6.2%
Effect: Actual lower than expected is good for the CAD
17:00 USD ISM Manufacturing PMI
Consensus: 58.4
Effect: Actual higher than expected is good for the USD
Noteworthy News
- The White House Administration could not get the new tax reform over the line yesterday, and today could be where the finally close the deal. They will be hoping that this becomes a watershed moment for them today.
