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Today's edition of the Saxo Morning Call features the SaxoStrats team discussing the continuing weakness of the US dollar as commodity prices recover ground and in the wake of key US equity indices hitting all-time highs Thursday.
Article / 05 January 2016 at 22:29 GMT

US Market Wrap: US dollar climbs as drama recedes

FX Trade Strategist / www.Loonieviews.net
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Watchlist:

•    Numerous European countries celebrate Epiphany
•    China: Caixin China Services PMI                                                              0145 GMT

US Data released

•    No data of note

The US dollar followed up Monday’s rally with another strong performance, gaining against all of the G-10 currencies with the exception of the yen. EURUSD broke support at 1.0790 and now has its sights on the 1.0500. USDCAD broke above 1.4000 and tested 1.4018 before retreating. A poor Global Dairy Trade auction result had the Kiwi dollar testing its December bottom. A lack of any meaningful US data left forex traders fretting about China equity markets, rising tensions in the Middle East and what, if any, new information will be gleaned from the Federal Open Market Committee minutes on Wednesday.

US equity indices closed mixed on the day. The Nasdaq was a loser, in part due to Apple (AAPL: NASDAQ) dialing a wrong number. Bloomberg quotes the Nikkei Asian Review stating that Apple would cut production of its newest iPhones by 30%

Crude oil prices renewed their decline in New York, undermined by traders with a propensity to sell rallies and by concern that the Saudi/Iran feud would derail any hopes of production cuts in the near term. WTI dropped from $37.10/barrel and touched $35.74/b before bouncing and closing at $36.16/b.

Opinion

If you are looking for things to worry about in Europe at the start of a new year, Trading Floor contributor Juhani Huopainen posted a great article: A new year dawns. a new euro crisis beckons.


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Crude flows as trouble brews ... traders believe that the Saudi/Iran feud derails any hopes of Opec production cuts in the near term. Photo: iStock
 

– Edited by Robert Ryan

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, our regular European Morning Markets, From the Floor analyses and Mid-session Europe.

3y
Ali Baba Ali Baba
Mike - What's your Best Trade at the moment ?
3y
Michael O'Neill Michael O'Neill
Very sorry, Ali Baba-I didn't see your question until just now.
3y
AlexSGabor AlexSGabor
My Best Trades are Borrowing BTC at 12% and investing proceeds iinto TSLA through Pen Bancorp.

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