U.S. Session Forex Recap – July 8, 2015

  • CA trade balance: 3.34B CAD deficit vs. 2.55B CAD deficit expected, 2.99B CAD deficit last month
  • US trade balance: 41.87B USD deficit vs. 42.7B USD deficit expected, 40.7B USD deficit last month
  • US IBD/TIPP economic optimism: 48.1 vs. 48.9 expected, 48.1 previous
  • US JOLTS job openings: 5.36M s. 5.33M expected and previous
  • UK NIESR GDP estimate: 0.7% vs. 0.6% previous
  • EU Summit ends with no resolutions
  • Tsipras to meet Merkel and Hollande in Brussels
  • Japan current account numbers due today

Profit-taking was the name of the game in yesterday’s U.S. forex trading session, as the major currency pairs erased some of their gains/losses from the earlier trading sessions.

As I mentioned in my London session recap, low-yielding currencies like the dollar and yen dominated the risk aversion theme earlier in the day. This wasn’t the case during the U.S. session though, when the lack of fresh market catalysts and continued uncertainty over Greece encouraged intraday profit-taking across the board.

The European currencies felt the most relief with EUR/USD popping up by 23 pips (+0.21%) to 1.0977, EUR/GBP rising by 32 pips (+0.45%) to .7125, and GBP/USD inching 24 pips higher (+0.16%) to 1.5466.

The yen also felt the pinch of profit-taking. Yen crosses moved higher with EUR/JPY jumping by 99 pips (+0.74%) to 135.10, GBP/JPY rising by 57 pips (+0.31%) to 189.63, and AUD/JPY zooming 46 pips (+0.51%) to 91.37.

The dollar, which could have gained support from slightly better-than-expected trade deficit and JOLTS job openings reports, failed to make any headway throughout the session. USD/JPY only gained 17 pips (+0.14%) to 122.61, a small feat compared to other yen pairs, while USD/CHF lost 38 pips (-0.40%) to .9457.

Even the comdolls were on the profit-taking train. Gold prices continued to plummet and the U.S. EIA projected even more U.S. oil stockpiles, but AUD/USD managed to climb 27 pips (+0.36%) to .7452, NZD/USD inched 23 pips higher (+0.35%) to .6654, and USD/CAD dropped by 17 pips (-0.13%) to 1.2713. Yowza!

Will we see more action from Asian session forex traders? Just because there weren’t any fresh market movers yesterday doesn’t mean that there was absolutely no development. Though there were no formal announcements from the EU Summit yesterday, word around the hood is that Greece is about to request a loan from the European Stability Mechanism (ESM), which could provide short-term relief for the Greek banks if approved.

Only Japan’s current account numbers are due over the next couple of hours, so you might want to pay attention to risk-related headlines instead. More specifically, watch out for any more big moves from the Chinese markets that might encourage more selling of high-yielding bets.

Good luck!

See also:

London Session Recap

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