U.S. Session Forex Recap – July 17, 2015

  • US initial jobless claims: 281K vs. 285K expected, 296K previous
  • US NAHB house price index: 60 vs. 59 expected, 60 previous
  • US Philly Fed manufacturing index: 5.7 vs. 12.0 expected, 15.2 previous
  • US net long TICS flows: 93.0B USD vs. 30.3B USD expected, 54.4B USD previous
  • Nothing new from Yellen’s testimony in front of Congress
  • ECB raises Greece’s ELA by 900M EUR
  • AU CB leading index on tap

The dollar’s price action was a mixed bag of nuts as forex traders bought some high-yielding currencies amidst a round of risk appetite.

The biggest story yesterday was the ECB’s monetary policy decision. Though the central bank didn’t make any changes to its monetary policies and has no plans on changing them anytime soon, it did raise Greece’s Emergency Liquidity Assistance (ELA) by another 900M EUR. The move not only gave reprieve to Greek banks, but also communicated the ECB’s commitment to keep Greece within the euro zone.

Risk appetite ensued, though most of the risk-takers turned to the equities markets. The European markets closed the day in the green with FTSE rising 0.63% higher at 6,796.45 while DAX rose by 1.53% to 11,716.76. Gains were also seen in the U.S. equities market with DJIA closing 0.39% higher while the S&P 500 gained 0.80% to 2,124.29.

The dollar made pips against its low-yielding counterparts and showed mixed price action against its higher-yielding forex buddies. Aside from risk appetite, one possible reason for the dollar’s limited gains is Uncle Sam’s less-than-stellar Philly Fed manufacturing index report.

USD/JPY jumped by another 7 pips (+0.06%) to 124.11, USD/CHF inched 10 pips higher (+0.11%) to .9578 and EUR/USD ended the session unchanged after rising to a session high of 1.0926. Even GBP/USD rose by 37 pips (+0.24%) to 1.5610.

Like the Greenback, the comdolls also showed mixed price action across the board. AUD/USD gained 12 pips (+0.16%) to .7403 on the back of higher gold prices. It seemed like Kiwi traders aren’t over the sharp drop in dairy prices though, because NZD/USD lost 13 pips (-0.20%) to .6513 despite the overall risk-friendly environment. USD/CAD, which was still trading on the BOC’s rate cut and strong dollar, rose by another 29 pips (+0.22%) to 1.2969.

Let’s see if the comdolls can catch a break today. The only report on the docket is Australia’s CB leading index numbers at 12:00 am GMT. The report doesn’t usually cause sustained moves among the Aussie pairs, so you might want to keep your eyes peeled for any news that might affect risk sentiment instead.

Good luck and good trading!

See also:

London Session Recap

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