Dollar Rallies while S&P 500 Retreats, Neither Looks Confident Yet
The Dow Jones FXCM Dollar Index (ticker = USDollar) posted its biggest rally since
In general, the absence of a strong 'risk appetite' drive does not mean that we are in turn caught in an intensive 'risk aversion' current. Consolidation and indecision are a common median. Yet, given the tightening noose around the US equity indexes, a high profile technical beak is likely due before the end of the week. The burden is translating a volatility event - even one as media-worthy as a stock market breakout - into a systemic shift in market exposure. In terms of 'probability', a five-year bull trend for capital markets built on confidence fed by stimulus is more likely to continue. However, for 'potential', a forced unwinding of record leverage is far more potent than a wave of new buying interest at record highs and 15-year low participation.
Looking for fundamental fodder for the dollar that doesn't focus on the bursting seams of risk trends, growth and monetary policy are still topics of merit. This past session, we found the found opposing housing sector readings with January new home sales rising to the fastest pace in five years while mortgage applications for home purchases fell to their lowest level in since 1995 through this past week. Coming up, we have durable goods orders figures for January. Though important, these figures don't tap the 'big picture'. Far more interesting will be the monetary policy ruminations. Fed Chair
Euro Breaks 1.3700 but a Bear Trend Requires a Bigger Push
Perhaps one of the most impressive moves in the FX market Wednesday, EURUSD finally managed to break a week-and-a-half worth of congestion when it stumbled below 1.3700. Yet, that was a hardly a definitive move. Activity levels (measured by the 10-day average true range) on EURUSD are at their lowest levels since
Yen Once Again Disagrees with Equity, EM Risk Assessment
Once again, the Yen crosses were a sanity check for sentiment diviners working off the failed equity run and dollar rally this past session for their assessment. Where EURJPY and AUDJPY made mildly provocative moves, the rest of the crosses were holding their ranges. Coming up, we may see the other side of the fundamental scales tip and dislodge the Japanese currency. Conviction in a BoJ stimulus upgrade come April has cooled substantially as of late. With a round of employment, consumption, manufacturing and inflation data; we'll have a comprehensive view.
British Pound: GDP Unrevised on Unflattering Details,
The updated 4Q
Australian Dollar Tumbles after Sharp Drop in 4Q
While local economic data is important for the Aussie dollar, regular indicators' ability to alter RBA expectations are typically rather limited. Yet, the 4Q private capital expenditure report from this morning certainly generated heat with a near 45-pip tumble from AUDUSD after its release. The 5.2 percent drop is the biggest since 3Q 2009 and second largest in 15 years. Aussie 2-year yields plunged 3 percent on the news.
Swiss Franc May Face Breakouts but GDP May Not Provide
Emerging Markets: Brazil Hikes Rates, China Fears Enduring
Interest rates are an important tool for Emerging Markets as it is frequently needed to curb inflation and pinch off capital outflow. Nevertheless, the
Gold Breaks Stride but Silver Suffers Biggest Drop in 4 Weeks
Private Capital Expenditure (4Q)
Last figure was the best since early 2012.
GDP (QoQ) (4Q)
With SSI positioning at an extreme, a print deviating from estimates here may have a large impact on price action.
GDP (YoY) (JAN)
German Import Price Index (YoY)
Inflation figures tap into larger deflation fears, but the German jobs figures are more consistent market mover
Consumer Confidence (FEB)
German Unemployment Change (000's) (FEB)
German Unemployment Rate (FEB)
M3 3-month average (FEB)
Last M3 growth rate figure was the lowest since the 2nd/3rd quarter of 2010.
M3 Money Supply (YoY) (FEB)
Italy Business Confidence (FEB)
Italy Euronomic Sentiment (JAN)
Consumer Confidence (FEB F)
Highest since mid 2011.
German CPI (YoY)(FEB P)
Disappointing CPI figures here could put pressure on the Euro ahead of the March ECB meeting.
German CPI EU Harmonized (YoY) (FEB P)
Durable Goods Orders (JAN)
Price action following the print may be muted by the fact market participants will be waiting for Dr. Yellen to begin her testimony in front of the
Durables Ex Transportation (JAN)
Initial Jobless Claims (
Continuing Claims (
Building Permits (MoM) (FEB)
Estimates call for the worst print since early 2013.
Markit/JMMA Manufacturing PMI (FEB)
Estimates call for a YoY nationwide print equal to levels not seen since early 2008. Any severe print to the downside could lead to a weaker yen as market participants speculate on BoJ action this spring.
Overall Household Spending (YoY) (JAN)
Jobless Rate (JAN)
Natl CPI (YoY) (JAN)
Natl CPI Ex Fresh Food (YoY) (JAN)
Natl CPI Ex Food, Energy (YoY) (FEB)
Industrial Production (MoM) (JAN P)
Industrial Production (YoY) (JAN)
Retail Trade (YoY) (JAN)
Large Retailers' Sales (FEB)
Upcoming Events & Speeches
Fed's Pianalto Speaks on Career in
BOJ Board Member Sato Speaks at IBA in
Fed's Yellen Testifies to
Fed's Fisher Speaks on
Fed's Lockhart, George to Speak on Banking Outlook in
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