We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Bearish
Wall Street
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bullish
USD/JPY
Bearish
More View more
Real Time News
  • Join @ddubrovskyFX 's #webinar at 8:00 PM ET/12:00 AM GMT to find out what information you can gain from knowing what other traders are buying or selling. Register here: https://t.co/Bb3CTCTm44 https://t.co/14EYRSUsUU
  • US President Donald Trump said he has had fruitful discussions with Saudi Arabia and Russia on oil prices and efforts towards combatting the #coronavirus - First Squawk #OOTT
  • South Korean daily exports may show negative growth - Finance Chief (BBG) #KRW
  • President Donald Trump says he has not done anything on tariff payment deferments and that he has not been presented a delay plan -BBG
  • New Zealand Finance Minister the Treasury is considering "bespoke" solutions for bigger firms needing financial assistance - BBG #NZD
  • The #Dow Jones Industrial Average sold off by as much as 38.4% from the February high to the March low, while the S&P 500 lost as much as 35.9% over the same observed period. Get your #equity market update from @JStanleyFX here: https://t.co/HkNM11G1n9 https://t.co/Tiremr0LkX
  • US equity futures pointing lower heading into Asia's Wednesday trading session
  • President Trump says we're going to go through a very tough two weeks #coronavirus
  • $EURUSD Daily Pivot Points: S3: 1.0862 S2: 1.0958 S1: 1.1002 R1: 1.1099 R2: 1.1151 R3: 1.1247 https://www.dailyfx.com/pivot-points?ref=SubNav?utm_source=Twitter&utm_medium=DFXGeneric&utm_campaign=twr
  • #DAX: Bulls have been unable to break above resistance derived from the December 2018 lows. Get your DAX market update from @PeterHanksFX here: https://t.co/dnJxJVLIOD https://t.co/X6wF8UKN87
NAFTA Fuels Knee-Jerk S&P 500 Volatility. EUR/USD Uptrend Done?

NAFTA Fuels Knee-Jerk S&P 500 Volatility. EUR/USD Uptrend Done?

2018-09-02 23:00:00
Daniel Dubrovsky, Analyst
Share:

Asia Pacific Market Open – Liquidity Drain, NAFTA, S&P 500, US Dollar, EUR/USD, Italy

  • European stock declines and worse-than-expected Eurozone CPI fueled US Dollar gains
  • NAFTA updates sparked knee-jerk S&P 500, stock volatility. JPY and CHF appreciated
  • Italy credit rating downgrade, liquidity drain may fuel EUR/USD loses as uptrend ends

Trade all the major global economic data live and interactive at the DailyFX Webinars. We’d love to have you along.

The US Dollar outperformed against its major counterparts on Friday amidst haven bids, with its appreciation picking up pace during the European trading session. There the DAX and Euro Stoxx 50 declined after market open, echoing weakness in Asia Pacific indexes. Broad Euro declines amidst worse-than-expected Eurozone CPI data also lifted the greenback as hawkish ECB monetary policy bets fell.

US stocks were on pace to end the day lower, but an update on NAFTA sent the S&P 500 rallying which caused it to close little changed. Despite a report that US-Canada trade talks stalled, Wall Street rejoiced the outcome as the NASDAQ Composite rose alongside the S&P 500. Canadian benchmark equities on the other hand fared worse as the TSX declined on the update.

This could have been the case due to the world’s largest economy essentially securing an agreement with its southern neighbor. US Trade Representative Robert Lighthizer noted that Trump will sign a deal with just Mexico, but only leaving the door open to Canada “if it is willing”. Negotiations between the United States and its northern neighbor are to resume on Wednesday.

Pro-risk currencies such as the Australian and New Zealand Dollars depreciated as market mood deteriorated throughout most of the day. AUD/USD suffered its largest daily decline in more than one week as it closed at its lowest point this year so far. But the pair could decline in the week ahead. Meanwhile the anti-risk currencies such as the Japanese Yen and Swiss Franc appreciated.

This week begins with a partial drain in liquidity as US markets are closed for the Labor Day holiday. As a result, stocks and currencies could be vulnerable to sudden changes in sentiment. This could come from trade war fears if China announces retaliation on threats of additional $200b in US tariffs. European markets could also be left vulnerable after Fitch lowered Italy’s rating outlook to negative from stable. This was a result of rising deficit concerns as economic nationalism threatens EUR/USD.

EUR/USD Technical Analysis – More Declines Ahead?

EUR/USD prices have closed under a near-term rising trend line that began with a bullish reversal pattern. The pair stopped its descent in a rising channel of support/resistance, but Euro weakness in the days ahead could see the pair drop to 1.1531 next. This area kept the pair afloat through June and July, it may reestablish itself as support. Meanwhile, a near-term resistance is above the August 28th high at 1.1744.

EUR/USD Daily Chart

Chart created in TradingView

US Trading Session

NAFTA Fuels Knee-Jerk S&P 500 Volatility. EUR/USD Uptrend Done?

Asia Pacific Trading Session

NAFTA Fuels Knee-Jerk S&P 500 Volatility. EUR/USD Uptrend Done?

** All times listed in GMT. See the full economic calendar here

FX Trading Resources

--- Written by Daniel Dubrovsky, Junior Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.