James Kim@Saxo
In this webcast, Saxo's global sales trader James Kim takes the helm to examine the big issues for the week including more than one third of the S&P 500 set to report.
Article / 24 August 2016 at 22:55 GMT

US Market Wrap: Oil plunge encourages dollar bulls

FX Trade Strategist /


  • Japan: Foreign Investment    2350 GMT

US data released

  • Housing Price Index June (Actual 0.2% vs. forecast 0.3%) 
  • Existing Home Sales Change July (Actual down 3.2% vs. forecast down 0.4%) 
  • EIA Crude Stocks change August 19 (Actual 2.501 m/b vs. forecast down 2.5 m/b)
The US dollar was sneakily bid in an active but low volume session and finished the day with gains against the G10 currencies except for sterling. 

New York traders inherited an “offered” EURUSD from Europe and it stayed that way throughout the morning, falling from 1.1280 at the open to 1.1244 by lunch. It drifted back toward 1.1260 by the end of the day.  

USDJPY started the day in demand and stayed that way until the afternoon. GBPUSD, the owner of the largest short position on record (as of last week) moved higher ahead of the Federal Reserve Chair Janet Yellen's speech.

An early morning rally in oil prices turned into a mid-morning rout when the EIA Weekly Crude Stocks change report was released. Inventories rose in crude, gasoline and distillate stocks. WTI plunged from $47.69 to $46.44 and then spent the rest of the session in the $46.75 area.

US equity traders may have used the drop in oil and the rise in the greenback to lighten up on positions. The major indices closed in the red.

An early morning rally in oil prices turned into a mid-morning rout, finishing
in the $46.75/b area. Photo: iStock


If you have taken a shine to gold, you should read Saxo Bank Head Of Commodity Strategy, Ole Hansen's article: Gold remains stuck in no man's land ahead of Jackson Hole.

– Edited by Gayle Bryant

Michael O'Neill is an FX consultant at IFXA Ltd. Follow Mike or post your comment below to
engage with Saxo Bank's social trading platform.

Missed a day? Here’s what we had to say during our Asian session and our regular European Morning Markets, From the Floor and Mid-session Europe.
yuiyui yuiyui
maybe the u$ shorts are just covering before jackson hole. I think that the resent turn in the tide (short U$) was really strong and a little unexpected. If there should be a 25 point rate rise the markets would be all confused and wouldn't know what to do. Maybe that's exactly what they have been waiting for, lol


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