Article / 03 August 2016 at 23:04 GMT

US Market Wrap: Oil rebounds on falling gas supplies

FX Trade Strategist /


  • Japan: Foreign Investment    1950 GMT 
  • Australia: Retail Sales            2130 GMT 

US data released

  • ADP Employment Change (Actual 179,000 vs. forecast 170,000) 
  • Markit Services PMI (Actual 51.4 vs forecast 51.0) 
  • EIA Crude Oil Stocks change (Actual 1.413 m/b vs. forecast -1.833 m/b 

The battered US dollar showed signs of life, in another holiday thinned New York trading session. It even managed to squeeze out a tiny gain against JPY. 

A healthily ADP employment report and Chicago Fed President Charles Evans may have contributed to improved sentiment towards the greenback. ADP beat the forecast while Evans conceded that: "I do think that perhaps one rate increase could be appropriate this year."

EURUSD was offered from the start, declining from 1.1224 to 1.1140. Sterling traders backed off the overnight high but still appear to be positioned for the Bank of England to disappoint them.

Oil prices rebounded. WTI started the day at $39.78 and never looked back. Traders ignored the build in the weekly crude stocks inventory because the decline in gasoline inventories was nearly double. They also ignored the part of the report that said crude inventories are at historically “high levels” and gasoline inventories are “well above the upper limit of the average range”. USDCAD declined on the news.

The Dow Jones Industrial Average ended its seven-day losing streak and the major US indices closed in the green.

 On the rebound ... oil prices rallied on Wednesday, with WTI starting the day at $39.78 and
never looking back. Photo: iStock

Don't discount coincidences in your every day trading suggests Trading Floor contributor fxtime in his article: Coincidence and confidence.

– Edited by Gayle Bryant

Michael O'Neill is an FX consultant at IFXA Ltd. Follow Mike or post your comment below to
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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.


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