U.S. Session Forex Recap – Mar. 22, 2016

  • U.S. Existing Home Sales down to 5.08M, below 5.31M forecast, 5.47M previous

The U.S. kicked off the Monday session with weak economic data and unfortunately for forex traders, it wasn’t enough to get the needle barely moving among most pairs.

Major Events:

Weak U.S. economic data – Existing U.S. home sales was the only economic data point on tap, and it disappointed U.S. bulls by coming in both below the forecast (5.31M) and the previous month number (5.47M) at a meager 5.08M homes. It looks like this data point is well on its way to break the 5.0M home barrier, which we’ve only seen happen once since March 2015. We did see a hiccup in forex price action with a brief dip in the Greenback, but the markets quickly returned to pre-event prices as the news was quickly brushed off.

Tight market ranges – Global markets barely made a move on the session, and this was despite comments from two Fed officials (Lockhart and Williams) that point to the possibility of an April FOMC rate hike. Both were modestly upbeat on the U.S. economy, and said that both April and June would “definitely be potential times to have an increase in interest rates.” Normally, Fed speak does tend to have an impact on broad risk sentiment, but the fact that both are not voting members in 2016 may be the reason we didn’t see a big volatile reaction.

But it looks like Fed commentary did have an affect on the Greenback as the U.S. dollar futures crept higher from the 95.10 open to 95.40 on the Monday session. And for whatever the case may be, risk sentiment was in slight bull mode at the S&P 500 also managed to make a move higher after hitting session lows around 2044.00, closing up 0.10% to 2051.60. On the commodity front, WTI crude also made positive moves in the quiet session, up +1.19% to close at $39.91.

Major Currency Movers:

USD – As mentioned above, the Greenback did get a slight push from Fed speak during the U.S. trading session, making it on of the only noticeable directional moves among a very quiet price action. USD/JPY rose from the week opening price at 111.51 to go into the Asia session trading around 111.90, and EUR/USD moved steadily lower after making session highs around 1.1284 to end just above session lows at 1.1241–only a 40 pip range!

NZD – The Kiwi also made a push higher in the latter half of the U.S. session, likely on the broad, but muted risk-on sentiment. NZD/JPY is now trading around 75.79 after hitting Monday lows around 75.15, and now testing the 1.1200 handle in AUD/NZD after hitting session highs around 1.1240 during the European and U.S. session.

Watch Out For:

  • 12:30 pm GMT: Australian House Price Index: 2% q/q previous

See also:

Asian Session Recap

London Session Recap

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