Asian Session Forex Recap – May 10, 2016

  • China’s CPI (y/y) remains at 2.3% in April as expected
  • China’s PPI (y/y) down by 3.4% vs. 3.8% decline expected, 4.3% downtick previous

Forex price action was a mixed bag of nuts, as a bit of risk-taking got mixed in with jawboning from some Finance Ministers.

Major Events:

Finance Ministers’ comments – Japan’s Finance Minister Taro Aso is still keeping the yen bears busy today after he straight out said that the Bank of Japan (BOJ) would intervene if the “one-sided moves” persist. The question is, at what levels will the BOJ pull the trigger and how much intervention is it prepared to launch?

New Zealand’s Finance Minister Bill English also created some waves when hinted that tomorrow’s Reserve Bank of New Zealand (RBNZ) financial stability report would include some macro measures on housing. This is problematic for rate hike hunters, as a measure to control New Zealand’s housing industry would remove another obstacle for the RBNZ to cut its rates some more. Duhn duhn duhn.

Yen weakness, China’s inflation inspire risk appetite– The yen’s weakness inspired confidence for Japan’s equities markets, which eventually translated to overall risk-taking for the Asian bourses.

It might have also helped that China’s annualized CPI showed a 2.3% growth and marked its fastest increase since mid-2014 while the PPI numbers rose for a second straight month. The stabilizing prices in China regulated concerns that the world’s second largest economy is cooling too fast for comfort.

Major Market Movers:

JPY – The yen was one of the biggest losers during the trading session, as forex traders continued to react to threats of a BOJ currency intervention.

USD/JPY is up by 48 pips (+0.44%), EUR/JPY is up by 47 pips (+0.38%), and GBP/JPY is up by 57 pips (+0.37%).

JPY – The yen was one of the biggest losers during the trading session, as forex traders continued to react to threats of a BOJ currency intervention.

USD/JPY is up by 48 pips (+0.44%), EUR/JPY is up by 47 pips (+0.38%), and GBP/JPY is up by 57 pips (+0.37%).

AUD – The Aussie got a boost from China’s steady inflation numbers. AUD/USD went up by 20 pips (+0.27%), AUD/JPY is up by 57 pips (+0.72%), and EUR/AUD is down by 52 pips (-0.33%).

NZD – Thanks to speculations of more RBNZ rate cuts, the Kiwi lost pips against most of its major counterparts.

NZD/USD is down by 26 pips (-0.38%), AUD/NZD is up by 72 pips (+0.67%), and GBP/NZD is up by 68 pips (+0.32%).

Watch Out For:

  • 5:45 am GMT: Switzerland unemployment rate (3.5% expected vs. 3.4% previous)
  • 6:00 am GMT: German industrial production (-0.2% expected vs. -0.7% previous)
  • 6:00 am GMT: German trade balance (23.4B EUR expected vs. 19.8B EUR previous)
  • 6:45 am GMT: French government budget balance and industrial production
  • 8:00 am GMT: Italian industrial production (0.3% expected vs. -0.6% previous)
  • 8:30 am GMT: U.K. goods trade balance (-11.2B GBP expected vs. -12.0B GBP previous)

See more:

U.S. Session Forex Recap

Bonnie and Clyde, peanut butter and jelly, Kanye West and Kanye West. Some things just go well together.

In forex trading, you get better odds at securing pips when your fundamental analysis is complemented by technical analysis.

Head on to Big Pippin’s Daily Chart Art for some pip-locking technical setups!