Article Highlights

  • US initial jobless claims: 304K vs. 315K expected and 315K previous
  • US wholesale sales up by 0.50% vs. 0.60% uptick expected and 1.0% growth last month
  • Concerns on Portugal’s bank weigh on risk appetite
  • CA new house price index up by 0.10% vs. 0.20% expected and previous
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Risk aversion remained the main driver of yesterday’s forex price action as traders reacted to more disappointing reports. If you recall, the Asian trading session brought grief too the Aussie bulls after a weak employment report was followed by a slightly smaller Chinese trade surplus.

The currency bears stepped up their game during the early London session when industrial production reports in the euro zone widely missed expectations and the UK printed weaker-than-expected trade numbers.

This time around it was concerns in Portugal that fueled the risk aversion. Trading of shares of Banco Espirito Santo, Portugal’s second largest bank, had to be halted after falling by more than 17% to its lowest price this year on accounting irregularities. Officials soon gave their statements but the price action was enough to remind investors of the European debt crisis.

EUR/USD remained steady at the 1.3606 area but EUR/JPY suffered another 4-pip drop to 137.87 while EUR/GBP slipped by another 10 pips to .7941.

Only Australia’s home loans report at 1:30 am GMT is scheduled for release during the Asian session. The report doesn’t usually have a lasting impact on the Aussie pairs so you might want to watch out for continuation or reversal of yesterday’s forex price action. More specifically, keep an eye on your major yen pairs for possible signs of more risk aversion.

See also:

London Session Recap

Bonnie and Clyde, peanut butter and jelly, Justin Bieber and his hair. Some things just go well together.

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Head on to Big Pippin’s Daily Chart Art for some pip-locking technical setups!