USD Weakens On Fed Confusion April 17, 2015
Fed Member Confusion Sends USD Tumbling
I actually enjoy that there is some disagreement in the Fed these days. It does show that at least they are thinking for themself even if they have a skewed view of things sitting in a chair far removed from life on the street making enough money that they even notice, much less care, that grocery prices are on the rise along with most other necessities in daily life. I knew yesterday during the speeches it would be eventful but one certainly did take the cake. Stanley Fischer would be the winner here.
Although he did say some positive things that I would surely hope hes right about even if I have mt doubts, which were “We expect that the markets look ahead somewhat, so I think—I hope—that they are taking into account that the Fed, at some point, is likely to raise the interest rate,” adding that markets “can’t depend on the current situation continuing forever—or even probably—beyond the end of this year.” Along with “even though the start of the year was poor there are signs there is a rebound underway”
I sure hope hes right but what got me going was this one.
*FISCHER: ONE WEAK JOBS REPORT FOLLOWED 5-6 `SPECTACULAR’ ONES
Your joking right? Well lets have a look see at the recent NFP data and see just how spectacular the last 7 reports. Keep in mind that in order to actually get the recently unemployed back in the workforce the US needs to be creating well beyond 200-250K jobs a month just to take on the graduating students each and every year. These figures change each year which is why a rough estimate for a real jobs recovery is NFP figures above if not well above 300K a month for several consecutive months. Now for the data.
This pic does not show April NFP for March which was expected at 245K and came out at 126K and to top it off the 295K you see at the top there was revised down 30K to 264K. So where are the “spectacular” reports?
EUR/USD Finishes Second And Third Push
With the EUR/USD running the tail end of the second along with the third push up yesterday we should see some sort of a reversal today. However it has already pulled back off the highs more than 60 pips so that may be all we get so I will be more open on direction today looking for a test of yesterdays highs for a safer short. The Asian highs are valid but do carry more risk. I will also consider the long from the Asian lows at 1.0752 but would prefer they test 1.0742 before setting up considering the added risk trading in the middle of a third push. Otherwise the 1.0700 is safest for the long but if they push there I would rather be short waiting to take profits.
GBP/USD Extends Pushes Into Daily Resistance
At this point the GBP/USD has a much better chance for the reversal with the push into some daily/monthly resistance just above yesterdays highs. Having said that, if they are that convinced the US will not be raising rates any time soon then I wont rule out a break higher either. The best level for a short is at 1.4964 while the monthly high is just above at 1.4975. I will be open for the long but if I do catch it at 1.4896 and it cant break through the highs I wont be holding it over the weekend.
EUR/JPY Pushes Up From Range
With this push up I will have a bias for the long on this pair. The best level is 127.65 but the 127.91 is valid along with the Asian lows being held up by the hourly 200. I will be open for the short from the Asian highs but would prefer a stop run to yesterdays highs and will need some clear price action to change the bias.
Forex News Today
The news starts off with UK Unemployment and Earnings data expecting to drop almost 30K from the Unemployed list and Earnings remain flat. We shouldnt get much baring a big surprise but if employment is flat while earnings rises decent the GBP will benefit and we may just get the break higher on GU. Later is Euro Zone CPI expected to still be below zero and while a disappointment wont do much if its small any pop above zero should get the Euro strength going.
The US has CPI data as well and will only get them going on a miss. Positive and USD will get some strength back or weaken on a disappointment. The bigger the miss the better the move.
Have a great weekend
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