October Market Overview

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Monthly Currency Trading News

$Us Dollar: The month started with Non-Farm Employment Change well below expectations, increased Unemployment Claims with Unemployment Rate remaining at 5.1%. Disappointing ISM non-manufacturing PMI and Trade Balance followed. FOMC minutes indicated the belief that the US recovery is likely to remain insulated from the China slowdown keeping the central bank on track to begin ending its stimulus later this year. The interest rate remained at zero.  PPI m/m, Core Retail Sales m/m, Retail Sales m/m and Filly Fed Manufacturing Index all came below expectations. CPI m/m came as expected, Core CPI m/m and Unemployment Claims improved while Building permits came below. Forth week brought disappointing Core Durable Goods Orders m/m, CB Consumer Confidence, Advanced GDP q/q and slightly increased Unemployment Claims, but well below expectations. The month ended with unchanged Interest Rates and Fed indicating that the increase of interest rates before December is firmly on the cards.
CNY: The month started with China Manufacturing PMI slightly above and unchanged Caixing Manufacturing PMI. Second week brought improved Trade Balance against expectations and disappointing CPI y/y. Second half of the month saw reduced Industrial Production y/y and reduced GDP q/y (6.9%) but above expectations, which was immediately followed by China cutting interest rates for the sixth time this year.

EurUsd: German Zew Economic Sentiment came well below expectations, French Flash Manufacturing PMI improved, German came below expectations.  German Info Business Climate came slightly above. ECB kept rates on hold.

EurUsd
EurUsd

Hammered by aggressive selling after Draghi said they are willing to expand their QE asset purchasing program and they are actively exploring the ways of doing so, EurUsd broke through all-time 61.8Fib and the uptrend trendline, retesting it from below with a high test bar.

GbpUsd: Manufacturing, Construction PMI and Manufacturing Production m/m came above expectations, Services PMI below. BOE kept interest rates on hold. CPI y/y, Average Earnings Index 3m/y and Claimant Count Change were disappointing. Retail Sales came above expectations and the month ended with disappointing Preliminary GDP q/q, below expectations.

 

AudUsd: Retail sales came as expected which was followed by disappointing Trade Balance and no change in the interest rates. Unemployment Rate remained Steady while Employment Change much below expectations. The month ended with disappointing CPI q/q.

AudUsd
AudUsd

AudUsd has done a full cycle about 0.7 support and the 15 year trendline. Now stuck in the triangle just below all-time Fib 61.8.

UsdCad: The month started with GDP m/m higher than expected, followed by Trade Balance and Building Permits m/m in the red.  Unemployment Rate increased to 7.1% while Employment change slightly improved. Manufacturing Sales m/m came above expectations. Bank of Canada kept interest rates on hold. Core Retail Sales and Core CPI m/m were disappointing. The month ended with GDP m/m coming with no change as expected.

Week ahead in the News

Very busy week ahead:

USD: ISM Manufacturing and Non-Manufacturing PMI, ADP Non-Farm Employment Change, Non-Farm Employment Change, Trade Balance, Unemployment Claims, Unemployment Rate and Average hourly Earnings m/m. Care to be taken with the running positions around Non-Farm.

CNY: Manufacturing PMI, Caixin Manufacturing PMI; GBP: Manufacturing, Construction and Services PMI, BOE Inflation Report and Official Bank Rate; Aud: Building Approvals, Cash Rate, Retail Sales, Trade Balance; Cad: Trade Balance, Employment Change, Unemployment Rate; NZD: GDT Price Index. Employment Change q/q, Unemployment Rate.

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