GBP/USD under pressure while USD tops the performance charts
Increased no-deal Brexit risks takes the pound lower, retail bias still in heavy long territories at 68%.
EUR/USD: Euro fails to keep up with the greenback for a third consecutive session
While the euro outperformed compared to other FX majors, it couldn’t best the US dollar for a third consecutive session, finishing closer to the lows as its bear trend technical overview continues to stall and show a lack of momentum. In terms of data, its M3 money supply figure expanded at its fastest rate since 2017 and private loans increased as well. On the political front, a coalition has been agreed upon in Italy, taking its yields lower though nowhere near that of Germany, with its 10-year yield back at fresh negative lows and yesterday’s bond auction at an average -0.7% with a lower number of bids made compared to the previous auction. And we’re in for more data, preliminary German CPI figures released today prior to tomorrow’s Eurozone CPI, and on the US side preliminary GDP figures for Q2, trade, and housing.
GBP/USD: Pound lags on rising chance of a no-deal Brexit
The pound was heavily in focus yesterday and lagged significantly compared to the remaining FX majors, as plans to suspend parliament for more than a month increased the likelihood of a no-deal Brexit by the end of October. In the process, it has kept its bear trend line in check, and retail bias hasn’t shifted much with longs holding on anticipating retracement. While US tier 1 data this evening will keep the pair’s USD aspect a bit livelier upon its release, its Brexit and internal UK political rumors/news/action that’ll likely keep the GBP aspect even livelier.
USD/JPY: Yen underperforms despite ongoing flight to safety
Equities in general didn’t finish that far from where they started, but yields continued to drop as investor flight to safety continued, though it didn’t aid the yen in finishing higher underperforming instead amongst most of the FX majors. In the grand scheme of things, it wasn’t by much and hasn’t undone its current weakened and stalling bear trend technical overview that is significantly lacking momentum and usually only shifts when there’s a serious risk-on/off event. September 1 is when the additional tariffs will be applied, and hence risk appetite may be effected heading into that event. Plenty of Japanese data will be released prior to that, with CPI, unemployment, and industrial data released tomorrow morning.
USD/CAD: Canadian dollar down for the day despite a higher finish for energy prices
Although energy prices finished higher yesterday buoyed by a massive EIA deficit, the Canadian dollar couldn’t best the greenback (with the US itself is on the verge of becoming a net oil exporter). More positive technical bias is forming for this pair, with its price closing just beneath its 200-day moving average and pushing retail bias higher into heavy short territories standing now at 74% as more longs get enticed into closing out as the pair’s price approaches a short-term resistance level. In terms of data, US preliminary GDP figures will be released today, with Canadian GDP released tomorrow alongside other data.
AUD/USD: Lower lows but lacking momentum as bear trend technical overview continues to stall
It’s a second consecutive finish lower for this pair’s price as commodity currencies didn’t perform well yesterday, lagging somewhat compared to their FX peers. And although AUD is down this morning following another private capital expenditure contraction, its Antipodean neighbour’s currency is getting hit harder, with NZD/USD at lows unseen since 2015 following a plummet in business confidence to 2008 lows. As for this pair’s technical overview, while it’s a bear trend, it has been stalling heavily at the lows and lacking momentum, and retail bias inching higher and closer to extreme long levels. It stands in almost exact contract with institutional bias of a heavy short 75%.
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