- US December Markit Manufacturing Index at 55.1 (November 55.0)
- Gold rally extended overnight gains
- Wall Street kicks off 2018 with gains. Nasdaq closed at 7,006.90
By Michael O'Neill
NY focus: Happy New Year. The freezing temperatures across much of northern US and Canada and the extended seasonal holidays may have contributed to an extremely slow trading day. A lack of top-tier, actionable data was also a factor.
opened just below the overnight peak (1.2080) and dropped steadily until mid-morning when prices recovered to 1.2059 by day's end. Traders (at least those who were at work) appeared unwilling to extend the post-Christmas EURUSD gains, which occurred in thin, holiday markets.
Sterling was bid at the open and rose from a mid-morning low of 1.3543 to 1.3598. Lingering month-end and year-end portfolio rebalancing requirements may have contributed to the gains.
was ignored. Prices were trapped within a 112.06-112.33 range. Modest gains in US Treasury yields provided some support.
The Canadian dollar outperformed the antipodean currencies. USDCAD
dropped from 1.2547 to 1.2502 on the back of firm oil prices, and bearish USDCAD technicals. NZDUSD
traders ignored news that the GlobalDairyTrade auction posted a 2.2% increase.
Oil prices continued to be supported by concerns about Iran demonstrations and the freezing cold temperatures across northern US and Canada. Gold prices reversed a morning slide and rallied throughout the afternoon, finishing the day at $1,317.85, a 0.6% gain. Broad US dollar weakness was behind the move.
Freezing temperatures across much of northern US and Canada and the extended seasonal holidays contributed to an extremely slow trading day. Photo: Shutterstock
Wednesday focus: The minutes from the December 14 Federal Open Market Committee meeting may put a dampener on trading activity until the release in the New York afternoon. If the minutes are considered even mildly hawkish, it may be enough to spark a corrective selloff in EURUSD.
EURUSD 1 hour
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– Edited by Gayle Bryant
Michael O'Neill is an FX consultant, currency strategist and author of the Trade of the Day at Loonieviews.net. Follow Mike or post your comment below to engage with Saxo Bank's social trading platform.