Forex Market News
Markets are treading water ahead of Thursday mornings FOMC statement. FX markets in particular are seeing reduced flow http://www.bloomberg.com/news/2014-07-28/global-currency-trading-falls-amid-volatility-drop-market-probe.html, however the flow is slow across the board as central banks from Asia to America maintain record low rates with sluggish growth.
The greenback weakened somewhat overnight but it was very quiet out there. The weakness came from some seeing the US economy as stumbling. GDP on Wednesday night is seen as coming in at 3.1% which is pretty good, but others are saying it is more likely to be 1%, which ain’t so crash hot.
DATA HIGHLIGHTS TODAY – US Pending Home sales & Consumer Confidence.
AUDUSD – Really is going nowhere fast. Alan Kohler last night suggested it’s because some think we will get another rate cut and some think we won’t. I believe it is being held up because of the carry trade, when I in reality it should be lower. Either argument, either way, there is a clear lack of commitment to a direction or trend and therefore should be avoided until one side wins.
EURUSD – Tiny inside buyer bar. Certainly oversold and due a minor rally but we have no signals to take that trade yet.
GBPUSD – A swing low yes, but it is a seller bar as well, a test bar if you like. I would have preferred to see the bar close above 1.70 level. Less capital behind the trade until a full commitment by the market is seen is the better idea.
NZDUSD – A low test bar and oversold. Doubt we will get divergence but is looking to turn and retest resistance and 50ema, which will allow us to get short this pair.
USDCAD – Inside bearish bar. Need one more of those to convince me to get short. One bar does not make a trend! But we are in the area we expect the market to turn for another run down. Just be patient and see the sellers commit.
USDJPY – Inside buyer bar, still going nowhere.