Article Highlights

  • French INSEE manufacturing confidence: 106 vs. 103 steady at expected
  • Italian trade balance: €4.30B vs. €4.21B expected, €3.67B previous
  • Euro Zone trade balance: €19.7B vs. €25.2B expected, €24.4B previous
  • Euro Zone final HICP y/y: unchanged at 0.6% as expected
  • Euro Zone final core HICP y/y: unchanged at 0.8% as expected
  • U.K. CBI industrial trends: 0 vs. -5 expected, -3 previous
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There were only low-tier items on the docket, so price action was rather choppy, with many pairs trading sideways. The Loonie was showing some broad-based weakness, though, likely because of retreating oil prices.

Major Events/Reports:

Oil dips – Oil benchmarks are still in the green for the day, but they were off their highs.

  • U.S. crude oil up by 0.47% to $51.14 per barrel with $51.45 as high for the day
  • Brent crude oil up by 0.80% to $54.45 per barrel with $54.68 as high for the day

There weren’t any major oil-related news, but market analysts say that we’re just seeing some profit-taking by the longs.

Moderate risk-taking – There were moderate signs of risk-taking during the session, since most of the major European equity indices were in positive territory.

  • The pan-European FTSEurofirst 300 was up by 0.17% to 1,422.72
  • The blue-chip Euro Stoxx 50 was up by 0.51% to 3,269.00
  • Germany’s DAX was up by 0.43% to 11,415.50
  • The U.K.’s FTSE 100 was up by 0.31% to 7,020.50

U.S. equity futures also got some support from the risk-on vibes.

  • S&P 500 futures were up by 0.20% to 2,263.00
  • Nasdaq futures were up by 0.17% to 4,943.38

Market analysts are still attributing the rally to optimism over year-end mergers and other corporate deals.

Major Market Movers:

CAD – The Loonie was the weakest currency of the session. There weren’t any particular news or events, so the Loonie was just probably tracking the dip in oil prices during the session.

USD/CAD was up by 39 pips (+0.30%) to 1.3365, EUR/CAD was up by 21 pips (+0.16%) to 1.3949, GBP/CAD was up by 59 pips (+0.36%) to 1.6640

NZD – Despite the modest risk-taking in equities, the higher-yielding Kiwi ended up as the second weakest currency of the session. In fact, the Kiwi is the weakest currency of the day. There were no apparent catalysts for the Kiwi’s weakness during the session itself. However, the Kiwi (and the higher-yielding Aussie as well) has been sliding broadly lower since the Fed’s decision to hike rates. A possible reason for this is outflows from New Zealand (and Australia as well) in favor of the U.S., thanks to the narrower interest rate differentials after the Fed’s rate hike.

NZD/USD was down by 18 pips (-0.26%) to 0.7015, NZD/CHF was down by 10 pips (-0.14%) to 0.7220, NZD/JPY was down by 20 pips (-0.25%) to 82.92

Watch Out For:

  • 1:30 pm GMT: Canadian foreign security purchases ($12.35B expected, $11.77B previous)
  • 1:30 pm GMT: U.S. building permits (1.24M expected, 1.26M previous)
  • 1:30 pm GMT: U.S. housing starts (1.23M expected, 1.32M previous)

See also:

Asian Session Recap

U.S. Session Recap

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