Tuesday January 18, 2005 - 11:23:26 GMT
Share This Story
DailyFX.com - www.dailyfx.com
FOREX: US OPEN MARKET POINTS 01-18-05
The 1.30 Magnet Pulls the Dollar.
The target was just too tantalizing. For the past few days we’ve been writing about the psychologically important 1.30 barrier in the EUR/USD and in tonight’s European session, after probing the big figure several times, prices momentarily tumbled just below that level touching the 2995 bid. However, the pair quickly recovered as buyers poured in protecting a series of option barriers with a variety of strikes just below 1.3000. Euro longs were also aided by mildly positive Euro-Zone Industrial data which printed –0.3% versus –0.5% projected as the rising euro took a small toll on European manufacturers than the market expected.
Of course tonight’s price action may well be moot by morning as all eyes will focus on the TICS report due 14:00 GMT today. The consensus estimate is for a surplus of $55 Billion versus last month’s very weak report of $48 Billion. However, analysts from Goldman Sachs are predicting a much higher number of $66 Billion driven mainly by increased investment flows into US equities after election uncertainties were removed from the market in November. If GS is correct in their assessment the 1.3000 figure will almost certainly be tested once again since the $66 Billion figure will amply cover the -$60 Billion Trade Deficit reported last Wednesday.
Meanwhile in Japan, more evidence of a bounce as the Coincident Index component of the LEI data registered a rise to 60% - above the critical 50% expansionary level for the first time since August. The yen however, having set a yearly high against the dollar yesterday is materially lower, approaching the 103 figure as traders gear up for bullish TICS report.
Finally, surprisingly strong inflation data from UK as CPI experienced its biggest jump since June 2004 fueled by spending on furniture and household goods. Combined with a much better reading from the RICS housing survey of –37 vs. –48 expected, the long suffering pound was actually able to mount a rally all the way to 1.8680 after hitting an eight week low during the Asian session earlier in the day.
FX Spot Overnight
- EUR dips below 3000 but quickly bounces back as option barrier defenders pour in
- JPY data better buy yen weakens on bullish USD data expectations
- GBP recovers from 8 week low as CPI data surprises to the upside
- CHF tagging 1800 on position squaring ahead of TICS
- 13:30GMT – (08:30 AM EST) CAD Leading Indicators m/m (DEC) Expected -0.1%Previous 0.0%
- 13:30GMT – (08:30 AM EST) USD Empire Manufacturing (JAN) Expected 25.00 Previous 29.93
- 14:00GMT – (09:00 AM EST) USD Net Foreign Security Purchases (NOV) Expected $55B Previous $48.1B
- 18:00GMT – (13:00 PM EST) USD NAHB Housing Market Index (JAN) Expected 70 Previous 71
- 20:45GMT – (15:45 PM EST) NZD Consumer Prices (q/q) (4Q) Expected 0.7% Previous 0.6%
- 21:45GMT – (16:45 AM EST) NZD Food Prices m/m (DEC) Expected 0.1% Previous -0.1%
- 13:30GMT – (08:30 AM EST) USD Industrial Production (DEC) Expected 0.4% Previous 0.3%
- 14:15GMT – (09:15 AM EST) USD Capacity Utilization (DEC) Expected 78.9% Previous 77.6%
Forex Trading News
Daily Forex Market News
Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."