U.S. Session Forex Recap – Dec. 18, 2015

  • U.S. initial jobless claims: 271K vs. 275K expected, 282K previous
  • U.S. Philly Fed manufacturing index: -5.9 vs. 1.0% expected, 1.9 previous
  • U.S. current account: -124B USD vs. -123B USD expected, -111B USD previous
  • U.S. CB leading index: 0.4% vs. 0.2% expected, 0.6% previous
  • NZ ANZ business confidence: 23.0 vs. 14.6 previous

Dollar domination was the name of the game during the U.S. session, as forex traders got more confident about pricing in the Fed’s rate hike.

Major Events:

Traders ignore Uncle Sam’s weak reports – Data from the U.S. mostly came out weaker-than-expected, with initial jobless claims slipping from 282K to 271K while the Philly Fed manufacturing index fell from 1.9 to a -5.9 index reading. Last but definitely not the least was the current account report, which clocked in a deficit of 124 billion USD, a level not seen since 2008, on account of falling exports.

Forex traders mostly shrugged off the reports though, probably because they’re still feeling the love from the Fed’s recent rate hike. After all, we did see a bit of unwinding of dollar longs right before the Fed’s announcement. Are the forex bulls back to piling up on their dollar trades?

Oil drags comdolls lower – Oil lost its momentum and fell to near its 11-year lows on the back of another report showing increases in oil inventories. WTI fell by another 57 cents while Brent crude also slipped by 39 cents. Unsurprisingly, the comdolls took some hits with USD/CAD now flirting with the 1.4000 handle. 1.4000, people!!!

Major Currency Movers:

USD – The Greenback shot higher across the board as more and more traders are getting confident about buying the dollar. EUR/USD fell by another 37 pips (-0.34%) while GBP/USD also dropped by 29 pips (-0.19%). It also gained a couple of pips against its fellow low-yielders with USD/JPY popping up by 35 pips (+0.29%) and USD/CHF staying above the .9950 handle.

CAD – The oil-related Loonie was the biggest loser among the major currencies as oil prices took another tumble. USD/CAD rocketed by 125 pips (+0.90%) while CAD/JPY plunged by 49 pips (-0.55%) and GBP/CAD zoomed 146 pips (+0.71%) higher.

EUR – The common currency lost a few more pips against its counterparts as the Fed’s rate hike highlighted the contrast against the ECB’s plans of easing. While EUR/JPY took a 20-pip hit (-0.15%) while EUR/GBP also slipped by 14 pips (-0.19%) and EUR/CHF inched 38 pips lower (-0.35%).

Watch Out For:

  • BOJ monetary policy decision and press conference – The central bank isn’t expected to make any changes to its policies, but keep an eye out for possible hints on its plans for next year!

See more:

Asian Session Recap

London Session Recap

Bonnie and Clyde, peanut butter and jelly, Kanye West and Kanye West. 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!