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.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
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
Wall Street
Bearish
Gold
Mixed
GBP/USD
Mixed
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
USD/JPY
Mixed
More View more
Real Time News
  • 🇯🇵 Machinery Orders YoY (MAY) Actual: -16.3 Expected: -17.1% Previous: -17.7% https://www.dailyfx.com/economic-calendar#2020-07-08
  • 🇯🇵 Foreign Bond Investment (04/JUL) Actual: ¥-522.8B Previous: ¥196.2B https://www.dailyfx.com/economic-calendar#2020-07-08
  • Heads Up:🇯🇵 Machinery Orders YoY (MAY) due at 23:50 GMT (15min) Expected: -17.1% Previous: -17.7% https://www.dailyfx.com/economic-calendar#2020-07-08
  • Heads Up:🇯🇵 Foreign Bond Investment (04/JUL) due at 23:50 GMT (15min) Previous: ¥174.6B https://www.dailyfx.com/economic-calendar#2020-07-08
  • The Dow Jones could fall based on positioning signals, will the growth-linked Australian Dollar and Canadian Dollar follow? If so, what are the technical barriers ahead? Find out from @ddubrovskyFX here:https://t.co/yJrlR5C00P https://t.co/oR1TuteaqH
  • #AUD Braces for China CPI Amid Strained Sino-Australian Relations - https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/asia_am_briefing/2020/07/08/AUD-Braces-for-China-CPI-Amid-Strained-Sino-Australian-Relations.html
  • The Canadian Dollar has held onto gains that have developed since financial markets crashing out in March, and may now be poised to build on said gains. Get your $USDCAD market update from @CVecchioFX here: https://t.co/7TEDki01d9 https://t.co/DkCllzw9JG
  • Texas virus cases increase 4.7% vs prior 4% 7-day average - BBG
  • Update on #Cryptocurrencies #BITCOIN +1.81% #BITCOINCASH +2.82% #ETHEREUM +3.56% #RIPPLE +10.13% #LITECOIN +4.43%
  • AUD/USD: From a trading standpoint, be on the lookout for downside exhaustion ahead of the monthly open with a breach above 7042 needed to mark resumption of the broader uptrend.Get your $AUDUSD technical analysis from @MBForex here: https://t.co/cAZHl3PoMd https://t.co/wgjCEGrbLb
Sterling Continues to Outshine on PMI Upswing; USD Backtracks Post-NFPs

Sterling Continues to Outshine on PMI Upswing; USD Backtracks Post-NFPs

2013-08-05 10:33:00
Christopher Vecchio, CFA, Senior Strategist
Share:

ASIA/EUROPE FOREX NEWS WRAP

The British Pound is running neck and neck with the Japanese Yen as top performer to start the week, as the slate of improved British data since late-May continued. Today, it was the UK PMI Services report for July, surging to its highest level since December 2006, at 60.2 versus 57.4 expected.

The data follows last week’s improved July PMI Construction and Manufacturing reports, and overall caps what has been a stream of improved PMI surveys beginning in May. But as much as the British Pound has benefited the past few days, especially against the US Dollar (top performer; from $1.5102 on August 2 to as high as 1.5378 today), the streak of good fortune may hit a wall on Wednesday.

As per the Bank of England policy meeting on Thursday, Governor Mark Carney made clear that details on the central bank’s new “forward guidance” policy would be set forth alongside the pertinent Quarterly Inflation Report. In the July meeting, forward guidance was announced to reflect the BoE’s intent to keep rates pointed towards zero for the next several years. The reaction in the Sterling was quite negative; indeed, we are biased towards a bearish reaction by the British Pound.

Governor Carney has suggested that a nominal GDP target could work, and at the current rate of growth (+1.4% annualized), it’s no stretch of the imagination to think that a growth benchmark would be set higher (say, four consecutive quarters of growth exceeding +2%; or growth achieving +3%, etc). Regardless – the UK economy will fall short of whatever benchmarks are established at present time, which will deflate some of the optimism behind the Sterling.

Read more: UK Services PMI sets a 6.5-year High, Pound Rallies

Taking a look at European credit, slight weakness in the periphery is being offset by risk taking in the core, pushing the Euro up only marginally on the day. The Italian 2-year note yield has increased to 1.458% (+1.4-bps) while the Spanish 2-year note yield has increased to 1.837% (+3.2-bps). On the contrary, the Italian 10-year note yield has increased to 4.233% (-1.4-bps) while the Spanish 10-year note yield has decreased to 4.540% (-1.3-bps); higher yields imply lower prices.

RELATIVE PERFORMANCE (versus USD): 09:40 GMT

JPY: +0.56%

GBP: +0.48%

CAD: +0.09%

EUR:+0.07%

CHF:+0.05%

AUD:+0.03%

NZD:-0.69%

Dow Jones FXCM Dollar Index (Ticker: USDOLLAR): -0.24% (+0.66%prior 5-days)

ECONOMIC CALENDAR – UPCOMING NORTH AMERICAN SESSION

Sterling_Continues_to_Outshine_on_PMI_Upswing_USD_Backtracks_Post-NFPs_body_Picture_1.png, Sterling Continues to Outshine on PMI Upswing; USD Backtracks Post-NFPs

See the DailyFX Economic Calendar for a full list, timetable, and consensus forecasts for upcoming economic indicators. Want the forecasts to appear right on your charts? Download the DailyFX News App.

TECHNICAL ANALYSIS – CHART OF THE DAY

Sterling_Continues_to_Outshine_on_PMI_Upswing_USD_Backtracks_Post-NFPs_body_x0000_i1028.png, Sterling Continues to Outshine on PMI Upswing; USD Backtracks Post-NFPs

GBPUSDThe pair remains corrective after the rally off of the early-July lows, but a breach of the July highs around 1.5400 would negate this bias. The hold of the channel support at 1.5100/50 (off of the March 12 and May 29 lows) puts in focus a new developing ascending channel off of the July 9 and August 2 lows. Accordingly, a breach of 1.5430/40 puts in focus 1.5529/77 (ascending channel resistance; lower bound: 76.4% Fib retracement June high to July low; upper bound: 50% Fib retracement yearly high/low). A break of 1.5100 negates developing bullishness.

--- Written by Christopher Vecchio, Currency Analyst

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form

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

DISCLOSURES

News & Analysis at your fingertips.