Asian Session Forex Recap – May 19, 2016

  • Australia’s unemployment rate remains at 5.7% vs. 5.8% expected
  • Australia’s employment change up by 10.8K in April vs. 12.1K uptick expected, 25.7K previous
  • Japan’s core machinery orders rises by 5.5% in March vs. 1.9% decline expected, 9.2% drop in February
  • Asian bourses and commodities got weighed down by the hawkish FOMC minutes

Consolidation was the name of the game during the Asian session, as forex traders digested the FOMC meeting minutes and Australia’s jobs numbers.

Major Events:

Australia’s jobs numbers – Data released from the Land Down Under reflected that a net of 10,800 workers had found jobs in April, which keeps the unemployment rate at a two and a half-year low of 5.7%.

The underlying trends aren’t as rosy if we dig deeper into the report. The 10,800 net jobs increase, which missed estimates of a 12,100 uptick, is a reflection of 9,300 workers losing their full-time jobs and 20,200 part-time workers gaining employment.

This is in line with the recent decreases in wage growth and developments in part-time employment-friendly industries such as tourism, hospitality, and health care. Meanwhile the participation rate, a measure of the labor force as a share of the population, also dropped from 64.9% to 64.8% and hinted that the jobless rate held steady because workers had left the labor force instead of finding jobs. Duhn duhn duhn.

FOMC minutes aftermath – Asian session forex traders played catch up to yesterday’s FOMC meeting minutes release. As I mentioned in my U.S. session recap, the Fed members hinted that a June rate hike may not be completely off the table after all.

The possibility of less easy money in the U.S. markets weighed on the Asian bourses and commodity prices. Australia’s ASX is down by 0.93%, Hang Seng is down by 0.47%, and the Nikkei is down by 0.12%. Meanwhile, gold is also down by 1.26% while Brent crude oil is down by 1.43% and U.S. crude is down by 1.16%. Yowza!

Major Market Movers:

USD – The Greenback steadied against its European and fellow low-yielding counterparts but gained a few more pips on the comdolls following the FOMC meeting minutes release.

GBP/USD dipped by 12 pips (-0.08%) while EUR/USD remained at its open price. Meanwhile USD/JPY slipped by 16 pips (-0.15%) and USD/CHF ranged around the .9875 area.

Comdolls – Lower gold and oil prices weighed on the comdolls in general but the Aussie got a few more punches thanks to a rate cut-friendly employment release from Australia.

USD/CAD shot up by 43 pips (+0.33%) while NZD/USD rose to a session high of .6375 before settling lower to .6734. Meanwhile, AUD/USD is down by 22 pips (-0.30%), AUD/JPY is down by 36 pips (-0.45%), and EUR/AUD is up by 49 pips (+0.32%).

Watch Out For:

  • 8:00 am GMT: Euro Zone current account (19.6B EUR expected vs. 19.0B EUR previous
  • 8:30 am GMT: U.K. retail sales (0.6% expected vs. -1.3% previous)
  • 11:30 am GMT: ECB monetary policy meeting accounts

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!