Daily forex rundown: Euro, yen, Aussie & CAD

Euro (March)
Session close (Monday, Jan. 8): Lost 86 ticks to finish at 1.20125

Fundamentals: On the heels of a lackluster U.S. Nonfarm Payroll report and an outright miss on U.S. ISM Non-Manufacturing Friday, Eurozone Business and Consumer Survey was the best in nearly two decades and Retail Sales also beat expectations this morning. But today, the euro sold off nearly a penny. This was something we began to talk about late last week, we are long-term bullish, but this rally in the euro has started to run its course in the immediate-term. In fact, speculative longs now have a record position. Today’s Fed speakers didn’t even say anything to support the dollar. Atlanta Fed President Bostic said that three hikes in 2018 might be too many and San Francisco Fed President Williams continued to put an emphasis on lagging inflation. For the Euro to sell off this sharply on no news simply defines today’s session as technical in an overbought repositioning manner. German Trade Balance and Industrial Production are due at 1:00 am CT, the Eurozone Unemployment rate at 4:00 am CT and U.S JOLTs Job Openings at 9:00 am CT.

Technicals: Today’s session finished back below major three-star support at 1.20435, a level in which the euro needed to hold in order to maintain its immediate term uptrend. 

 

Yen (March)
Session close: Gained 5.5 ticks to finish at .8874

Fundamentals: The Japanese yen was the only major currency that finished the session in the green against the dollar. Prices went lower overnight but stabilized into this morning. As we discussed above, ultimately the Fed presidents who spoke today did not give the hawkish camp anything to run with. Overall the yen likely stabilized on Friday’s poor reads on U.S. data. The yen has been the only currency unable to capitalize on a weaker Dollar and today’s strength signals that the other currencies are going through a consolidation phase rather than a true reversal.

Technicals: The yen has been depressed and today’s session doesn’t give the bulls a ton to get excited about, though it is a positive development nonetheless. 

 

Aussie (March)
Session close: Settled at .7840, losing 28 ticks

Fundamentals: Its about time, after trading higher in 16 out of the last 18 sessions the Australian dollar finally had a pullback. Again, today wasn’t much about the news but rather time for the longs to take some profit. The US Dollar Index has been building a base and yes, the Aussie is not a component of the Index, but such a move can spark a ripple effect. Furthermore, traders await Chinese inflation reads tomorrow night. First, we have Aussie Building Approvals, ANZ Job Ads and Private House Approvals at 6:30 pm CT. Along with Chinese data tomorrow night is Aussie Business Confidence, and all of this has given the bulls a reason to take profit.

Technicals: Price action traded to a high .7874 on Friday and right into major three-star resistance at .7870-.7884. 

 

Canadian (March)
Session close: Finished at .80565, down 10 ticks

Fundamentals: The Canadian dollar put in a monster session on Friday after their employment report showed 78,600 jobs created when only 1,000 was expected. Ivey PMI later in Friday’s session missed expectations and took some of the wind out of the high-flying sails. The Canadian settled up 56 on Friday but was up nearly a penny at one point. There is no major data out of Canada this week but traders should keep an eye on Chinese inflation reads tomorrow evening as well as Crude Oil which continues to trade at the highest level since May 2015.

Technicals: Friday’s session high was .81005, the highest since September. However, it struggled to remain above major three-star resistance at .8085.