London Session Recap – April 10, 2014

  • French inflation data ticks lower: HICP y/y 0.7% vs. 0.8% forecast, 1.1% previous
  • French industrial production weaker-than-expected: y/y -0.8% vs. -0.3% forecast, 0.2% previous
  • BOE Monetary Policy Committee keeps rates steady at 0.5%, asset purchases at 375B GBP per month

During the Asia session, we saw very positive employment data from Australia, sparking volatility for the Australian dollar into the morning London session. Despite the pull back that kicked off at the London open, the Aussie is mostly up across the board against most of the majors:

AUD/USD is up 31 pips (+0.35%) to .9421, AUD/NZD is up by 66 pips (+0.61%) to 1.0828, and AUD/CAD is up 55 pips (+0.55%) to 1.0265.

The Japanese Yen is also a big mover on the session, rallying without an obvious catalyst, but most likely on the combination of broad USD weakness, the BOJ‘s positive comments during their monetary policy meeting earlier this week, and the decline in Chinese exports sparking risk aversion earlier today:

USD/JPY is down 36 pips (-0.35%) to 101.62, EUR/JPY is down by 35 pips (-0.25%) to 140.92, and GBP/JPY is down 71 pips (-0.41%) to 170.47.

We just got word that the Bank of England’s Monetary Policy Committee kept the interest rate at 0.50% and no change to it’s bond purchasing program.  There’s no statement at this time, and the reaction from currency traders seems to be a limited rally in Sterling at the moment. It’s still early so stay on your toes with any British Pound trades for the session.

Coming up in the afternoon London session, we’ve got Canadian and U.S. data on tap.  At 1:30 PM GMT, the U.S. will release the initial claims number (320K forecast vs. 326K prev) and Import Price Index data (0.2% forecast vs. 0.9% prev). Simultaneously, we’ll get Canada’s House Price Index data (0.1% forecast vs. 0.3% previous).  For the most part, these are low tier events, so we’ll have to see a big surprise to initiate any spikes in volatility.

At 7:00 pm GMT, the U.S. Federal Budget Balance will be released with expectations of -$36B forecast vs. -$193.5B previous read.  It’s a tier two event during the afternoon U.S. session, so a big surprise could be a market mover because of the lighter liquidity conditions.

See also:

Asian Session Recap

U.S. Session Recap

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