Asian Session Forex Recap – June 9, 2015

  • Chinese CPI down from 1.5% to 1.2% in May vs. 1.3% forecast
  • Chinese producer prices posted 4.6% annualized decline
  • Australia’s NAB business confidence index improved from 3 to 7
  • Home loans in Australia up by 1.0% vs. estimated 1.8% decline
  • Australia’s ANZ job advertisements fell flat in May
  • U.K. trade balance, Swiss jobless rate and CPI due

The dollar was down in the dumps again, after having been forced to return its post-NFP wins to its forex rivals. EUR/USD is up 20 pips (+0.18%) and is trading safely above 1.1300, GBP/USD is edging close to the 1.5350 handle (+0.03%), and USD/JPY is flat at 124.50.

Economic data came in mixed for today’s Asian trading session, with China printing a couple of dismal inflation reports and Australia showing some improvements. For the month of May, China’s CPI is down at 1.2% versus the projected 1.3% reading while producer prices marked a 4.6% decline year-over-year. For some forex market analysts, this seals the deal for another round of monetary easing from the PBOC or China’s central bank, as policymakers scramble to revive growth and inflationary pressures.

In Australia, the NAB business confidence index climbed from 3 to 7 in May, reflecting increased optimism among businessmen. This was followed by a positive home loans report, which indicated a 1.0% gain instead of the projected 1.8% decline. However, the ANZ job advertisements report showed a flat reading, which reflects the lack of growth in job opportunities.

With that, Aussie pairs are slightly weaker in the past few hours. AUD/USD is down 13 pips (-0.16%), AUD/JPY is lower by 12 pips (-0.12%), and AUD/CAD is down 26 pips (-0.27%). The Aussie chalked up larger declines to the euro, with EUR/AUD advancing by 58 pips (+0.40%) as of this writing.

Only a few medium-tier reports are lined up in the next few hours, which suggests the possibility of consolidation among most forex pairs. The U.K. is set to print its trade balance and possibly show a smaller deficit of 10 billion GBP compared to the previous 10.1 billion GBP shortfall. Switzerland will release its unemployment rate, which might show no change from the previous 3.3% reading, and probably show a mere 0.1% uptick in its CPI.

As always, be on the lookout for any developments on the Greek debt talks, as positive expectations seem to be lifting the euro at the moment. Last time I checked, ECB official Noyer has been talking about how the shared currency could continue to survive even if a Grexit takes place.

U.S. Session Recap

Bonnie and Clyde, peanut butter and jelly, Justin Bieber and his hair. Some things just go well together.

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