Session close: Settled at 1.1276, down 9.5 ticks
Fundamentals: Strong U.S job growth Friday was the latest catalyst pressuring the Euro in a slide now going on two weeks. Last week, U.S ISM Manufacturing was not as bad as feared and Manufacturing Payrolls crushed expectations in the first sign that U.S growth could be turning a corner. The Euro extended losses early this morning after German Industrial Production underwhelmed although Trade Balance data was a bit better and worked to buoy the tape in what has otherwise unfolded to be a quiet session. The biggest headwind for the Euro is now a potential divergence in central bank policy. Yes, the Federal Reserve is still fully expected to cut rates later this month, but they have not yet. Furthermore, markets are pricing in a 50% probability that they cut 75 basis points this year. If U.S data begins to surprise to the upside those odds would quickly dissipate while right now, nothing points to such a light at the end of the tunnel for the Eurozone.
Tomorrow brings a deluge of Fed speak with Fed Chair Powell kicking things off at 7:45 am CT (may not get much tomorrow since he testifies to Congress Wednesday and Thursday). St. Louis Fed President Bullard speaks at 9:10 am CT and Fed Governor Quarles speaks at 1:00 pm CT, both are voting members this year. JOLTs Job Openings are due at 9:00 am CT.
Technicals: The chart is not pretty, last week was just the Euro’s latest failure to hold higher prices. However, at a glance the front-month chart does not look as ugly as September-only. Friday’s selloff cut through a trend line on the September-only that now comes in just above 1.13; this will be our pivot and above here the tape will exude signs of stabilizing. However, the front-month chart is testing ... Please sign up for a Free Trial at Blue Line Future to view our entire technical outlook and actionable bias and levels.
Session close: Settled at .92445, down 14 ticks
Fundamentals: The Yen puked out Friday in the face of a strengthening Dollar and higher rates following better U.S job growth. Further pressure ensued today after a dismal read on Machinery Orders last night. BoJ Kuroda added that the bank will act as necessary to keep inflation trending to their 2% target. Despite weaker equity markets today, the Yen traded lower throughout the session.
Technicals: Price action in the Yen is trading into two close pockets of strong support. The first comes in at .... Please sign up for a Free Trial at Blue Line Future to view our entire technical outlook and actionable bias and levels.
Session close: Settled at .6987, down 9 ticks
Fundamentals: The Aussie has been tethered to the round .7000 mark over the last week battling a roller coaster of trade news, risk-sentiment, underwhelming data from Australia and better data from the U.S. Tomorrow’s Fed speak will be pivotal in helping define direction. Before then, we have NAB Business Confidence tonight at 8:30 pm CT.
Technicals: The near-term range is defined. Major three-star resistance aligns ... Please sign up for a Free Trial at Blue Line Future to view our entire technical outlook and actionable bias and levels.
Session close: Settled at .76465, down 6.5 ticks
Fundamentals: The Canadian has defied odds and expectations by grinding higher and holding ground in the face of headlines; a stronger U.S Dollar and a weak Canadian employment report topped off with a dismal Ivey PMI Friday. However, Canadian wages are quietly the catalyst gaining the most in more than a year. Furthermore, the Bank of Canada is expected to keep rates unchanged for the intermediate future and this policy divergence has fueled price action. The problem here is that any waver from the BoC Wednesday would be bearish.
Technicals: The trend is higher, but inversely to the Euro and Yen, this is not where you want to buy the Canadian. Price action ran into a crucial level of resistance Friday that aligned several technical indicators as well as the September contract swing high from February 1st. Pullbacks that hold first key support at .... Please sign up for a Free Trial at Blue Line Future to view our entire technical outlook and actionable bias and levels.
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