- Euro Zone Sentix indicator: 6.0 vs. 7.4 expected, 9.6 previous
Not much on today’s morning London trading session calendar, but price action among various forex pairs had a very noticeable theme – risk aversion flows are back!
Risk aversion returns – Risk assets across the globe are taking a hit to start the week during the European forex session, with the pan-European FTSEurofirst 300 down by a big -2.42% to 1,252.21 and the DAX down by -2.82% to 9,024.55. U.S. equity futures promise a risk aversion spillover into the U.S. market, too, with the S&P 500 futures down by -1.49% to 1,852.25 and Nasdaq futures down by -2.39% to 3,929.70 during the forex session.
Most market analysts point to a variety of potential catalysts including the fall in Chinese foreign reserves (second largest on record), continued global growth concerns, the North Korean long-range missile launch raising geopolitical concerns, or even the positive components from U.S. jobs data prompting speculation the Fed will keep rate hikes open as an option. Whatever the case may be, it’s a bloodbath out there for the bulls.
Commodities slide… again – Commodities were broadly in the red yet again, with U.S. crude oil down by -3.11% to $29.93 per barrel and Brent crude oil down by -2.64% to $33.21 per barrel during the forex session. Apparently, nothing good came out of the meeting between OPEC producers Saudi Arabia and Venezuela, where we saw no sign of steps to be taken to boost the market higher. With oversupply here to stay in the near future, traders jumped quickly to push the oil markets lower
Major Currency Movers:
Comdolls – After a little bit of a rally during the Asia session, the comdolls (AUD, NZD, CAD) took a dip once again against their forex rivals, particularly the safe-havens, to start the new week. The Loonie, in particular, has been shown no mercy with oil prices deep in the red and apparently looking to retest the fresh lows made back in January. Overall, the comdolls are mixed on the session, but have fallen considerably since moving higher earlier in the day.
AUD/USD was up by 1 pips (+0.01%) to 0.7058 after hitting highs around .7126
NZD/USD was dow by 17 pips (-0.27%) to 0.6604 after hitting highs around .6659
USD/CAD was up by 49 pips (+0.34%) to 1.3963 after hitting lows around 1.3840
Safe-havens – The safe-havens (JPY, CHF, USD) were getting much love once again on risk aversion flows, especially the Japanese yen. With so many potential arguments for uncertainty and fear, it’s no surprise that the yen is bullish across the board against the rest of the majors.
AUD/JPY was down by 32 pips (-0.41%) to 82.12 after hitting highs around 83.48
NZD/JPY was down by 48 pips (-0.65%) to 76.85 after hitting highs around 78.05
AUD/CHF was up by 26 pips (+0.39%) to 0.7023 after hitting highs around .7077
- 1:30 pm GMT: Canadian Building Permits (-19.6% m/m previous)
Bonnie and Clyde, peanut butter and jelly, Kanye West and Kanye West. Some things just go well together.
Head on to Big Pippin’s Daily Chart Art for some pip-locking technical weeks!