Asian Session Recap – January 21, 2014

  • NZ CPI renews rate hike speculations
  • BOJ begins monetary policy meeting
  • PBoC injects funds for the first time in a month
  • Fed watcher Jon Hilsenrath hints at Fed tapering in January
  • Nikkei closes up 0.99 % at 15,795.96
  • EZ and German ZEW economic sentiment on tap

Traders of Asian currencies got busy during the Asian session after a couple of reports boosted risk appetite. First, New Zealand’s quarterly CPI came in stronger-than-expected. This makes it easier for the RBNZ to raise its rates soon.

Then, China injected funds for the first time in a month and eased fears of a cash crunch in the second largest economy in the world. By the end of the session AUD/USD was up by 40 pips while NZD/USD enjoyed a nice 90-pip jump.

Fed watcher Jon Hilsenrath then inspired more optimism for Nikkei and weakness for the yen when he hinted that last month’s job numbers “failed to diminish” prospects of the Fed further reducing its bond purchases. In fact, he predicts that the Fed would reduce its asset purchases by another 10 billion USD in January. It’s no wonder USD/JPY is now trading 50 pips from its session open price!

It’s ZEW day for today’s London session as the euro zone’s and Germany’s ZEW economic sentiment reports are scheduled for release. The region doesn’t have problems with sentiment these days so I wouldn’t be surprised if we see the reports beat estimates.

Market players are expecting Germany’s ZEW reading to come in at 64.00 from last month’s 62.00 while the euro zone’s numbers are estimated at 70.2 from last month’s 68.3.

Good luck trading today, fellas!

See also:

U.S. Session Recap

Bonnie and Clyde, peanut butter and jelly, Justin Bieber and his hair. 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!