Article / 18 July 2016 at 23:37 GMT

US Market Wrap: US dollar drops as risk fears fade

FX Consultant / IFXA Ltd

  • Australia: RBA minutes 2130 GMT                                                   

US data released

  • NAHB Housing Market Price Index (Actual 59 vs. forecast 60)

FX traders sold US dollars across the board except for yen, in a fairly low volume New York session. The failed coup in Turkey quickly became a distraction rather than a disruptive market concern.

EURUSD started the day with a bid, rising to 1.1083 from 1.1040 but ran out of steam and traded sideways after that. USDJPY was under pressure at the start of the day but the improved risk appetite drove the currency pair from a low of 105.27 to a peak of 106.26.

For the most part, FX activity was just noise, with traders still looking for direction, wary of Brexit fall-out, new Bank of Japan stimulus, Thursday's ECB meeting and next week's Federal Open Market Committee meeting.

Renewed concern over rising supply helped push WTI prices down from the opening level of $45.92/barrel to a low of $45.22/b. There is a report of another build in oil supplies at Cushing, Oklahoma which contributed to the bearish tone.

However, bottom pickers emerged and WTI bounced slightly, to $45.45, before drifting lower into the close.

US equity indies were flat to modestly higher, supported by the better risk tone and a bump in financial shares, sparked by Bank of America (BAC: NYSE) beating earnings forecasts.

 Reports of strong supply are keeping WTI crude prices subdued. Photo: iStock


Gold bugs may be well served by watching Saxo Bank's Head of Commodity Strategy, Ole Hansen's video "The best way to play gold story-Hansen"

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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