• Trump meets Congressional leaders to avert government shutdown
• Sterling pops on possible Irish border deal
• Gold sinks and Bitcoin soars
By Michael O'Neill
NY Focus: New York traders didn’t have much to focus on when they started their day. The Eurozone Q3 data was as expected and it didn’t cause a ripple in FX markets.
However, the US dollar was firmer against most of the majors. GBPUSD was sneakily bid.
EURUSD bounced off minor support at 1.1770 but couldn’t get any traction above 1.1790.
Prices spiked to 1.1812 in the early afternoon and collapsed to 1.1770 just as quickly. Pre-payrolls report position adjusting undermined EURUSD.
USDJPY rallied the entire session, rising from 112.56 to 113.12 for the same reasons as above.
Sterling quickly recovered from a drop at the open and climbed steadily from 1.3322, finally pausing at 1.3482.
Headlines reporting that Prime Minister May and the DUP were close to a deal on the Irish border was behind the move.
Congressional leaders from both parties met with President Trump who said he expected that they would avoid a government shutdown. That news combined with progress on tax reform helped to underpin the dollar.
Tulips anyone? Bitcoin seems to have no ceiling at the moment. Photo: Shutterstock
The Canadian dollar led the antipodean currencies lower. USDCAD continued to be supported by disappointment from yesterday’s dovish Bank of Canada statement.
Wall Street finished with gains but below its best levels seen earlier in the day.
WTI oil prices rallied from $56.23 to $56.60 on fears on a Nigerian supply disruption.
Gold prices got hammered, losing 0.6% on the back of the rising dollar and perhaps because Bitcoin surged to $15,995 according to Reuters.
Bitcoin 1 minute
Source: UK Guardian/Reuters
Friday Focus: Nonfarm payrolls headlines a data-rich session with China and German trade data also due.
Sterling may be extra busy due to Brexit headlines and a slew of key economic reports. NFP is expected to show a gain of 200,000 jobs, unemployment rate at 4.1% and a 0.3% rise in average hourly earnings.
This report is described as the first NFP data that isn’t impacted by hurricanes, suggesting a top side risk to the data. If so, EURUSD will make a serious attempt a cracking the uptrend line from April, which comes into play at 1.1710.
Source: Saxo Bank
-- Edited by Adam Courtenay
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.