Posted on: 08 January 2016, by: Pepperstone Support, category: Market Review
More bad news for equities with the S & P settling down 2.7% and safe haven FX (EUR, CHF, JPY) and SEK being the strongest performers in G-10. AUD and NZD were sold according to the proximity to China playbook with AUD the worst performing currency in the group of ten.
EUR started off near 1.0780 to kick of European trade before ripping a full cent into the European equity open on what must’ve been a rush of short covering ahead of an expected sell off in local stocks. The pair finished near 1.0935.
Bank of Canada’s Poloz refrained from going dovish despite the wave of negatives to the Canadian economy stemming from the relentless offer in oil. USDCAD was sharply lower in the aftermath but found buyers in the 1.4050’s to finish the day at 1.4114.
The Danish central bank hiked rates if you were wondering, but only 10 bps to -.65%.
USDJPY is beginning to get comfortable below 118, printing a fresh low and approaching levels we haven’t seen since August of last year. NFP is tomorrow and it’ll be interesting given the beat in ADP to see where we end up. My guess is that we have a huge number just to throw more wrenches into an already chaotic market.
Looking ahead of the all-important NFP release, we have Australian Retail sales, UK trade balance, and Canadian employment. The market could be at very interesting levels in FX going into the US jobs release with people heavy into positions on the back of the past few days of trade. Beware the whipsaw.