U.S. Session Forex Recap – Dec. 12, 2014

  • US retail sales up by 0.7% in November vs. 0.4% uptick expected, 0.5% growth previous
  • US core retail sales up by 0.5% vs. 0.1% uptick expected, 0.4% growth previous
  • US initial jobless claims falls to 294K vs. 297K expected, 297K previous
  • US business inventories data increases by 0.2% vs. 0.2% expected, 0.3% previous
  • CA house price index grows by 0.1% as expected vs. 0.1% uptick last month
  • Oil prices drop below $60 for the first time in more than 5 years

Are you not entertained?! The Greenback showed the markets who’s boss during the U.S. forex trading session after a series of strong reports restored appetite for the low-yielding currency.

The dollar started the session on the right side of the charts after lollygagging in the previous trading sessions. Uncle Sam’s better-than-expected retail sales report helped, as it beat market expectations on the back of lower oil prices and better employment prospects. It also didn’t hurt that initial jobless claims fell to 294K when analysts had been expecting a 297k reading.

Not surprisingly, traders went back into buying the dollar like it’s next year’s hottest gadget. The closely-watched USD/JPY jumped by 51 pips to 119.07 after hitting an intraday high at 119.56 while EUR/USD slid by 43 pips to 1.2389 and USD/CHF inched 34 pips higher to .9696. GBP/USD was dancing to its own tune though, and jumped by 38 pips to 1.5719.

The comdolls also took hits against the low-yielding currency. AUD/USD didn’t get any support from strong Australian jobs figures released in the Asian session and just stayed at its intraday lows near .8250 while NZD/USD ranged tightly at the .7800 levels despite a hawkish RBNZ statement. USD/CAD, which priced in oil prices dropping below $60 for the first time in five years, finally broke above 1.1500 and closed at 1.1528.

We haven’t seen all the action yet!At 6:30 am GMT we’ll see a Chinese data dump including its industrial production, fixed asset investment, and retail sales reports. Analysts are generally expecting slightly weaker readings from last month, but keep your eyes peeled in case we see significant hits or misses that could dictate risk sentiment for the rest of the day.

Good luck and good trading, folks!

See also:

London Session Recap

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