London Session Forex Recap – Dec. 19, 2014

  • German PPI m/m: 0.0% vs. -0.2% forecast/previous; y/y dips to -0.9% vs. -1.1% forecast, -1.0% previous
  • German Gfk Consumer Sentiment index: 9 vs. 8.8 forecast, 8.7 previous
  • French INSEE Manufacturing Confidence index inline with 99 forecast/previous
  • European Current Account: 20.5B EUR vs. 30B EUR previous
  • U.K. Public Borrowing: 14.1B GBP vs. 15.1B GBP forecast, 7.1B GBP previous
  • U.K. CBI Distributive Trades: 61% bal vs. 30% bal forecast, 27% bal previous

Forex volatility picked up after a quiet Asia session, triggered by mostly positive data from Europe and the U.K.  Unfortunately, it was mostly choppy price action and tight ranges throughout the major currency pairs with the lack of major news catalysts.

Forex moves of note include a broad strengthening of the Australian dollar.  It was a small roller coaster ride for the currency as it took a broad hit midway through the Asia session before finding a strong bid right at the London open. AUD/USD hit session highs around .8190, dropped to .8150, but back up to .8180 at the moment.

The British pound seems to be on a roller coaster ride after positive public sector borrowing data and CBI distributive trades, which can be a leading indicator for consumer spending. Sterling dipped throughout the morning London session, even on the news, but has seem to have found a bid as we roll into U.S. trade.  After hitting session lows around 1.5617, GBP/USD has spiked higher since the CBI trade data bring it back to session open around 1.5664.

The forex calendar for the Friday afternoon London/morning U.S. session is light, but laced with potential market movers from Canada all coming at 1:30 pm GMT.

In just a few minutes, we’ll get Canadian consumer price index and retails sales data, both of which are top tier, potential market movers. The CPI number has been on the rise in recent months while retail sales performance has been mixed, so it should be interesting to see how the two major economic categories will drive the Loonie early in the U.S. session.

Other than that, it is possibly the last “real” trading day of the year before traders head off on holiday, so we may see a pick up in volatility as traders square off and adjust positions before year end.

This is also the last post of the year for the Piponomics team. Thanks for checking out our blog and we hope its been helpful to adding insight to your daily forex trading decisions.  Have a safe and happy holiday!

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!