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Forex News Timeline

Thursday, January 18, 2018

As widely expected, the Central Bank of the Republic of Turkey (CBRT) kept its key benchmark interest rate steady at 8% at its monetary policy meeting

As widely expected, the Central Bank of the Republic of Turkey (CBRT) kept its key benchmark interest rate steady at 8% at its monetary policy meeting held today.USD/TRY faded a knee-jerk spike to 3.8039 on the bank’s policy announcement, now reverting to the pre-decision levels near 3.7990, down -0.52% on the day.

   •  Renewed USD weakness helps regain some traction.    •  Surging US bond yields capping additional gains.    •  US economic data eyed for tradin

   •  Renewed USD weakness helps regain some traction.
   •  Surging US bond yields capping additional gains.
   •  US economic data eyed for trading opportunities. After an initial dip to fresh weekly lows, gold staged a modest recovery to $1330 level and recovered part of previous session's steep losses.  The precious metal stalled its corrective slide to the lowest level in nearly a week and was now supported by some renewed greenback weakness. In fact, the US Dollar Index struggled to build on overnight rebound from 3-year lows and eventually benefitted dollar-denominated commodities - like gold.  However, a follow-through pickup in the US Treasury bond yields, backed by growing market conviction that Fed would deliver at least three rate hikes in 2018, was seen keeping a lid on any additional gains for the non-yielding yellow metal. The Federal Reserve's Beige Book, released on Wednesday, provided anecdotal evidence that the US economy is strong enough to withstand multiple rate hikes in 2018 and triggered a fresh leg of an upsurge in the US bond yields.  Investors now look forward to upcoming US economic releases - housing market data, Philly Fed Manufacturing Index and initial weekly jobless claims, in order to grab some short-term trading opportunities. Technical levels to watchMomentum beyond $1332 level now seems to accelerate the up-move back towards $1340 supply zone en-route $1345 barrier. On the flip side, $1324 level might continue to protect the immediate downside, which if broken might turn the metal vulnerable to correct further towards $1312 horizontal support.
 

Turkey TCMB Interest Rate Decision meets expectations (8%) in January

Justin Smirk at Westpac offers his afterthoughts on the Australian labor market report released earlier today. Key Quotes: “Total employment rose 61

Justin Smirk at Westpac offers his afterthoughts on the Australian labor market report released earlier today.Key Quotes:“Total employment rose 61.6k compared the market’s 19k forecast and Westpac's +25k. In the month unemployment rose of 5.5% (5.55% at two decimal places vs. 5.41% in November) with a 0.2ppt gain participation driving a further 55.16k surge in the labour force. This surge in participation has been driven mostly by the incredible jump in female to a new record high of 60.6%. December was the15th consecutive monthly gain in employment, on par with the record of 15 consecutive monthly employment gains set in June 1995. Can we see a new record set in January 2017? Given current momentum in the labor market, and on ongoing strength in the leading indicators, it has to be fair chance. The Australian labor market gathered momentum through 2017 with employment growth accelerating from 0.9%yr in February to 3.3%yr in December. Total employment has grown 403.1k in the year.”

In its monetary policy decision due later today, the Central Bank of the Republic of Turkey (CBRT) is expected to keep all of its key interest rates o

In its monetary policy decision due later today, the Central Bank of the Republic of Turkey (CBRT) is expected to keep all of its key interest rates on-hold today, noted Annette Beacher, Chief Asia-Pac Macro Strategist at TDS.Key Quotes:“TRY In line with the unanimous consensus we expect the CBRT to keep all its rates on hold today.  In particular, the Late Liquidity Window (LLW) rate will be held at 12.75%. But we do anticipate the chance of a more relaxed message on inflation from the CBRT, which would in turn hint at the possibility of lowering rates later in the quarter. When the CBRT announced rates last time, on 14 December, inflation was at its peak in the current cycle, with the last available print, November CPI, standing at 13% Y/Y. The CBRT must have heaved a sigh of relief when December CPI came in at 11.9%, the first slowdown since July 2017. Further slowdown is possible and likely in the coming months as base effects become more favorable. In particular, large-scale TRY depreciation that occurred in the November 2016 to January 2017 period will start fading in the year-on-year comparison. A new bout of currency weakness, however, took hold again in September-November 2017, which is already translating in marginally higher inflationary pressures than would have otherwise been visible. This and risks of second-round effects will continue to keep inflation skewed to the upside and above target.”

The cross in AUD/JPY is seen making headways back towards the 89 handle, having found fresh buyers just ahead of the 88.50 barrier, where the daily pi

Shrugs-off mixed Aus jobs and Chinese data Focus shifts to BoJ policy decision. The cross in AUD/JPY is seen making headways back towards the 89 handle, having found fresh buyers just ahead of the 88.50 barrier, where the daily pivot intersects.AUD/JPY trades above all major DMAsThe recovery in the spot from the Aussie jobs induced drop to 88.40 levels gathered steam, following the release of the Chinese GDP figures, which surprised markets to the upside by steadying at 6.8% in Q4 while the GDP YTD Dec 2017 y/y came in at +6.9% vs +6.8% expected. Moreover, the cross also derives support from the renewed weakness seen in the Japanese currency against its American counterpart amid a turnaround in risk sentiment, as reflected by an upturn in oil prices and mostly higher European equities.       Attention now turns towards the US Philly Fed manufacturing, housing, and jobless claims data for fresh impetus ahead of next week’s BoJ monetary policy decision.

Spain 30-y Bond Auction rose from previous 2.874% to 2.9%

The UK PM Theresa May said in a statement on Thursday, Britain and France will agree on Thursday to deepen security cooperation, as she hopes that thi

The UK PM Theresa May said in a statement on Thursday, Britain and France will agree on Thursday to deepen security cooperation, as she hopes that this move will win her goodwill in Brexit talks, Reuters reports.Key Quotes:“Today’s summit will underline that we remain committed to defending our people and upholding our values as liberal democracies in the face of any threat, whether at home or abroad.”  “And while this summit takes place as the UK prepares to leave the EU, this does not mean that the UK is leaving Europe ... A strong relationship between our two countries is in the UK, France and Europe’s interests, both now and into the future.”

The US Dollar struggled to build on overnight strong rebound and held with modest losses in a rather subdued trading action on Thursday.  On Wednesda

The US Dollar struggled to build on overnight strong rebound and held with modest losses in a rather subdued trading action on Thursday.  On Wednesday, the greenback staged a solid rebound from fresh 3-year lows and was further supported by better-than-expected US industrial production/capacity utilization data. The recovery move got an additional boost after the Federal Reserve's Beige Book reaffirmed that the central bank was still on track for three rate hikes in 2018.  The up-move, however, lacked any strong follow-through traction and was now capped by a stronger Euro, which managed to recover part of previous session's sharp retracement from three-year tops.  Meanwhile, surging US Treasury bond yields, with 2-yr yields breaking out to the highest level since 2008 and 10-yr yields holding just under 2.60%, March 2017 highs, helped limit deeper retracement, at least for the time being.  There isn't anything notable data due for release during the European trading session and hence, the lackluster trading action is more likely to get extended until the US economic releases.  Today's US economic docket features the release of housing market data, which along with Philly Fed Manufacturing Index and initial weekly jobless claims should help traders grab some short-term trading opportunities.

Buy the dips? Negative UK stocks, oil prices weigh. Awaits US jobless claims, Philly Fed manufacturing index. The GBP/USD pair extends its bea

Buy the dips? Negative UK stocks, oil prices weigh. Awaits US jobless claims, Philly Fed manufacturing index. The GBP/USD pair extends its bearish consolidative mode into Europe, moving back and forth in a familiar range between 1.3800 and 1.3850 levels amid a lack of fresh catalysts.GBP/USD supported at 1.3800The spot returned to the red zone after its recovery from just ahead of the 1.38 handle faltered near the 1.3850 barrier, largely on the back of a renewed uptick seen in the US Treasury yields, which usually dull the attractiveness of the GBP as an alternative higher-yielding asset. More so, a minor bounce seen in the US dollar versus its main competitors also capped the recovery seen in the major. The USD index is seen reversing a dip to 90.48 levels (session lows) to now trade at 90.56, still down -0.10% on the day. Further, negative oil prices weigh down on the resource-heavy London stocks, collaborating to the downbeat tone seen in Cable. Also, looming Brexit concerns amid speculation over a second Brexit referendum gathering pace keeps any recovery short-lived. Looking ahead, “in absence of any fresh macroeconomic data from the UK, traders would take cues from the US economic releases - housing market data, Philly Fed Manufacturing Index and weekly initial jobless claims,” Haresh Menghani, Analyst at FXStreet, writes.GBP/USD Preferred StrategyJim Langlands at FX Charts, noted “The momentum indicators generally look positive but Cable remains very headline driven so caution is warranted. Buying dips seem to be the theme though, with an SL placed back below 1.3800.”Key Levels:Resistance Support  1.4100 Minor 1.3870 Minor 1.4050 Minor 1.3850 Minor 1.4000 Psychological 1.3825 Minor 1.3975 Minor 1.3785 Minor 1.3942 Session high 1.3756 Session low  

Oil benchmarks are down slightly, possibly due to fears that rising shale output would negate the impact of OPEC-led output cuts. As of writing, Bren

Oil benchmarks are down slightly, possibly due to fears that rising shale output would negate the impact of OPEC-led output cuts. As of writing, Brent is down 21 cents or 0.30 percent at $69.20/barrel, while WTI is changing hands at $63.89/barrel. The shale oil output could rise by 1.8 million barrels per day (bpd) over the next year, matching the volume of production cuts implemented by the OPEC, Russia and other major oil-producing nations, said the Energy Information Administration (EIA). Further, shale output is seen rising to 6.438 million barrels per day in January; up 24,000 bpd from December. The fears of rising shale output seem to have taken a wind out of oil bulls. Also, there is widespread belief that OPEC fears the major central banks would counter the oil-led rise in inflation by quickening the pace of policy tightening. Thus, the Cartel is likely to talk down oil prices. That said, losses could be restricted today as the militant group Niger Delta Avengers has threatened to launch attacks on Nigeria’s oil sector in the next few days.  

   •  USD struggles to build on overnight strong rebound.    •  Surging US bond yields fail to lend any support.    •  US data might provide some tr

   •  USD struggles to build on overnight strong rebound.
   •  Surging US bond yields fail to lend any support.
   •  US data might provide some trading opportunities.  Having posted a session high level of 0.9666, the USD/CHF pair came under some selling pressure and eroded part of previous session's strong recovery gains. Despite a strong follow-through upsurge in the US Treasury bond yields, renewed US Dollar weakness was seen as one of the key factors weighing on the major through the early European session.  Even the prevalent positive trading sentiment around European equity markets, which tends to dent the Swiss Franc's safe-haven appeal did little to lend any support and assist the pair to build on overnight recovery move from 4-month lows.  With the USD price dynamics turning out to be an exclusive driver of the pair's momentum, traders now look forward to the US economic releases - housing market data, Philly Fed Manufacturing Index and the usual initial weekly jobless claims, for some fresh impetus.Technical levels to watchCurrently trading around the 0.9635-30 region, testing session lows, a follow-through weakness has the potential to continue dragging the pair back towards the 0.9600 handle. On the upside, sustained move back above 0.9655-60 area might lift the pair even beyond the 0.9700 handle towards its next hurdle near the 0.9720-30 region.
 

Reuters reports comments from an Iraqi Oil Official, as saying that Iraq and BP are likely to sign an agreement to boost production from Northern Kirk

Reuters reports comments from an Iraqi Oil Official, as saying that Iraq and BP are likely to sign an agreement to boost production from Northern Kirkuk oilfields.

Hong Kong SAR Unemployment rate declined to 2.9% in December from previous 3%

   •  A modest USD pull-back helps regain traction.    •  Surging US bond yields likely to cap additional gains.    •  US economic data might provid

   •  A modest USD pull-back helps regain traction.
   •  Surging US bond yields likely to cap additional gains.
   •  US economic data might provide trading opportunities. The EUR/USD pair built on its steady up-move through the early European session and has now jumped o fresh session tops, around the 1.2215 region. A modest US Dollar retracement helped the pair to bounce off 1.2165 support, weekly lows, and recover part of previous session's sharp retracement slide from 3-year tops.  However, a fresh leg of upsurge in the US Treasury bond yields might now keep a lid on the pair's steady up-move. In fact, 2-yr yields broke out to the highest level since 2008 and 10-yr yields held just under 2.60%, March 2017 highs, which should underpin the greenback demand, at least for the time being. There isn't any market moving data due from the EZ and hence, traders would look forward to the US economic docket, featuring the release of housing market data, Philly Fed Manufacturing Index and the usual weekly initial jobless claims, for some fresh trading impetus.Technical levels to watchAny subsequent up-move is likely to confront resistance near the 1.2230 area, above which the pair is likely to head back towards 1.2260-65 supply zone before darting back towards the 1.2300 handle. On the downside, weakness back below the 1.2200 handle might continue to find some support near the 1.2165 region, which if broken might turn the pair vulnerable to slide back towards the 1.2100 round figure mark.
 

Will the bullish outside day reversal from 61.8 Fib support translate into long-term trend reversal in USD/JPY? Commerzbank Analyst Karen Jones sees

Will the bullish outside day reversal from 61.8 Fib support translate into long-term trend reversal in USD/JPY? Commerzbank Analyst Karen Jones sees little scope for long-term trend bullish trend reversal and expects the rally to fail at 114.38/82 major resistance. Jones writes- "Initial resistance lies at 111.73/112.05 (200 day ma). Above here lies the 113.64/75 December highs. There is a lot of resistance directly overhead – namely the 113.92 2015-2018 downtrend line. Above here sits the 114.38/82 major resistance, we continue to favour failure." Failure at 114.38/82 would keep the long-term neutral to negative outlook intact. Also, a rise to 114.38/82 is easier said than done as spot would need to chew through multiple hurdles lined up at 111.73/112.05 (200 day ma) and 113.92 (2015-2018 downtrend line). As of writing, the pair is trading at 111.15 - down 0.13 percent on the day. USD found bids in Asia but the positive follow-through to yesterday's bullish outside day candle ran into offers abov111.41 (38.2% Fib R of Jan. 8 high - Jan. 17 low).  

Speaking at a joint conference by the International Monetary Fund and the Deutsche Bundesbank, in Frankfurt, German Buba President Jens Weidmann was n

Speaking at a joint conference by the International Monetary Fund and the Deutsche Bundesbank, in Frankfurt, German Buba President Jens Weidmann was noted saying that a marked reduction in German growth potential could translate into lower long-term interest rates. Additional quotes:   •  Indicators of labour market slack would suggest higher wage settlements
   •  Factors responsible for holding back wage growth are partly international

The Bank of Canada (BOC) raised rates to 1.25 percent yesterday as expected, but said the uncertainty surrounding NAFTA negotiations is weighing over

Yesterday's doji signals indecision in the market. BOC warns of unknowns of the NAFTA’s renegotiation. Focus on T-yields and US dollar. The Bank of Canada (BOC) raised rates to 1.25 percent yesterday as expected, but said the uncertainty surrounding NAFTA negotiations is weighing over forecasts. Thus, USD/CAD saw two-way business before ending largely unchanged on the day. The resulting doji candle highlights indecision in the marketplace. As of writing, the pair is mildly around 1.2445. A positive close today would confirm the bullish doji reversal. Moreover, the odds of a positive close are high, given the uptick in the treasury yields is lifting greenback higher across the board. The two-year Treasury yield, which mimics short-term rate hike bets, rose to 2.06 percent today; its highest level since August 2007. An upbeat US data - weekly jobless claims, housing starts and building permits - may help USD score gains. Also, the bid tone around oil has weakened on fears the rising shale output could overshadow OPEC-led output cuts. Hence, CAD bulls may find it difficult to penetrate previous day's low of 1.2362.USD/CAD Technical LevelsA break above 1-hour 200-MA of 1.2461 would open doors for 1.25 (zero levels) and 1.2531 (previous day's high). On the downside, breach of the session low of 1.2426 could send the pair down to 1.2397 (Jan. 16 low) and 1.2362 (previous day's low).      

   •  A modest USD weakness helps regain traction.    •  Mixed Chinese data fails to lend additional support.    •  US data eyed for fresh trading i

   •  A modest USD weakness helps regain traction.
   •  Mixed Chinese data fails to lend additional support.
   •  US data eyed for fresh trading impetus. The NZD/USD pair traded with a mild positive bias for the second consecutive session but continued with its struggle to sustain above the 0.7300 mark. The pair did move past the mentioned handle on Wednesday and refreshed 4-month tops but witnessed a sharp reversal during the NY trading session. The Fed's Beige Book reaffirmed that the central bank was still on track for three rate hikes in 2018 and drove flows away from higher-yielding currencies - like the Kiwi.  Some renewed US Dollar weakness did assist the pair to regain some traction on Thursday but the up-move lacked strong conviction and was capped by mixed Chinese macro data. A slightly better-than-expected Chinese fourth-quarter GDP print was largely offset by a big miss on retail sales data and did little to provide any fresh bullish impetus. It would now be interesting to see if the 0.7300 handle continues to keep a lid on the pair or bulls are able to regain control as traders look forward to the US economic data from some fresh impetus.  Today's US economic docket features housing market data, which along with Philly Fed Manufacturing Index and the usual weekly initial jobless claims data might provide some short-term trading opportunities ahead of Friday's release of Business NZ Manufacturing Index.Technical levels to watchImmediate support is pegged near the 0.7245-35 region, below which the corrective slide could get extended towards the 0.7200 handle en-route 0.7155-50 strong horizontal support. On the upside, a sustained move above the 0.7300 handle might continue to confront fresh supply near the 0.7330 region, which is followed by a strong resistance near mid-0.7300s.
 

China's National Bureau of Statistics (NBS) Director Ning Jizhe was out on the wires, offering more insights, following the release of the key Chine

China's National Bureau of Statistics (NBS) Director Ning Jizhe was out on the wires, offering more insights, following the release of the key Chinese economic releases.Key Points:The survey shows that unemployment rate in December is under 5%. Urban unemployment rate in December is 4.98%. The economy created more than 13 million new jobs in 2017. Corporate debt ratio down by 0.5% y/y in 2017.

Carsten Brzeski, Chief Economist at ING, explains why he thinks the ECB will convey a dovish message when it meets next week to decide on its monetary

Carsten Brzeski, Chief Economist at ING, explains why he thinks the ECB will convey a dovish message when it meets next week to decide on its monetary policy program.Key Quotes:“At the start of the New Year, the ECB could currently feel as if it was in the middle of the set of a movie combining the scripts of “Groundhog Day” and “Aladdin”. Every time the ECB thinks that it bought some time and quiet, either macro developments or some ECB members’ statements (or sometimes both) undermine these plans and let the genie of speculations about policy changes out of the bottle. While the ECB had actually tried to hush any exit speculation with the October decision for “lower for longer”, strong macro data, a general fear in financial markets that inflation is not dead and could return faster than anticipated as well as some ECB officials’ talks have recently again fueled new speculation about the future of QE. For next week’s meeting, we expect Draghi to convey a rather dovish message, pointing to still weak inflationary pressure and also emphasizing the disinflationary impact from a stronger euro. The most important message to watch will be whether Draghi confirms the October statement that there will be no sudden end to QE. We expect him to do so as this would be the only way to – at least – temporarily get the genie back in the bottle. It would also show Draghi’s magic of how to guide financial markets with very few words and without any action.”

Gold fell to a 6-day low of $1324 and the two-year Treasury yield clocked a 9-year high of 2.052 percent possibly due to rising Fed March rate hike be

Gold hit a 6-day low of $1324. Two-year yield rose 9-year high on rising Fed rate hike bets. Gold fell to a 6-day low of $1324 and the two-year Treasury yield clocked a 9-year high of 2.052 percent possibly due to rising Fed March rate hike bets. Last Friday's stronger-than-expected US core CPI number pushed up the probability of a 25 basis point Fed rate hike in March to 70 percent. Meanwhile, the Fed Beige released yesterday reportedly left the doors wide open for a rate hike in March. Hence, the two-year Treasury yield, which is sensitive to short-term interest rate expectations, rose to 2.052 percent; its highest level since August 2007. The zero-yielding yellow metal is likely feeling the heat of rising short-term yields. That said, the downside could be capped by the lackluster action in the USD index. Also, as Reuters says, "investors will be watching Congress to see if it can put together a funding bill in time to avoid a US government shutdown" and that could restrict downside in the metal. Gold Technical Levels The metal has breached the ascending trend line (drawn from Dec. 12 low and Jan. 10 low). So, support levels at $1307.60 (Jan. 10 low) and $1300 stand exposed. On the higher side, a move above $1330 would shift risk in favor of a re-test of recent high of $1344.  

China fourth-quarter GDP came in at 6.8% y/y, beating the estimate of 6.7%. Also, December industrial production bettered estimate of 6.02% y/y to pri

China Q4 GDP & industrial production beat estimates but Forward-looking retail sales missed estimates. AUD/USD  could complete H&S in 1-hour chart. China fourth-quarter GDP came in at 6.8% y/y, beating the estimate of 6.7%. Also, December industrial production bettered estimate of 6.02% y/y to print at 6.2%. However, the Aussie is unimpressed, seemingly due to a big miss on the forward-looking retail sales number.  Consumption, as represented by retail sales, rose 9.4% y/y, missing the estimate of 10.1% by a big margin. Moreover, a weak retail sales data (dismal consumption) and an upbeat industrial production number indicate the economic rebalancing (from investment-driven growth to consumption-driven growth) is happening at a snail's speed.   The upbeat Aussie labor data released earlier today also failed to put a strong bid under the Aussie dollar. As of writing, the AUD/USD pair is trading at 1-hour 50-MA level of 0.7966. The 1-hour chart shows, the pair risks falling to 0.7942 - head and shoulders neckline on 1-hour.AUD/USD Technical LevelsA 1-hour close below 0.7942 would confirm the head and shoulders breakdown and open doors for 0.79 (10-day MA) and 0.7875 (Jan. 5 high). On the higher side, a break above 0.7978 (76.4% Fib R of Sep-Dec drop) could yield a rally to 0.80 (psychological level) and 0.8037 (Sep. 21 high).  

   •  Stalls overnight strong recovery move.     •  Downside seems limited for the time being.    •  US data eyed for fresh trading impetus.  The U

   •  Stalls overnight strong recovery move. 
   •  Downside seems limited for the time being.
   •  US data eyed for fresh trading impetus.  The USD/JPY pair met with some fresh supply near mid-111.00s and touched session low in the last hour, albeit quickly recovered few pips thereafter.  The pair stalled its overnight strong recovery move from the 110.00 neighborhood, or 4-month lows, and was now being weighed down by some renewed US Dollar weakness. The greenback pared some of its gains, supported by upbeat manufacturing data and the Fed's Beige Book, and has been one of the key factors behind the pair's modest pull-back from weekly tops.  The downslide, however, seems cushioned amid the prevalent risk-on environment, which tends to weigh on the Japanese Yen's safe-haven appeal and helped the pair to bounce back to 111.30 level. Adding to this, growing market conviction that the Fed will raise interest rates in March, reaffirmed by the ongoing upsurge in the US Treasury bond yields, might also contribute towards limiting any immediate downside, at least for the time being.  Traders now look forward to the US economic docket, featuring the release of housing market data, Philly Fed Manufacturing Index and the usual weekly initial jobless claims, for some fresh trading impetus. Technical levels to watchThe 111.00 handle now seems to protect the immediate downside, which if broken could accelerate the slide back towards the 111.50-40 strong horizontal support. On the upside, momentum beyond mid-111.00s is likely to confront hurdle at the very important 200-day SMA, near the 111.70 region, above which the pair is likely to dart towards reclaiming the 112.00 handle. 
 

China's YoY GDP figures for the fourth quarter of 2017 came at +6.8% vs +6.7% exp and 6.8% previous, with the QoQ reading for Q3 coming in at +1.6% vs

China's YoY GDP figures for the fourth quarter of 2017 came at +6.8% vs +6.7% exp and 6.8% previous, with the QoQ reading for Q3 coming in at +1.6% vs +1.6% exp and +1.7% last.  With regard to retail sales YoY, the number was +9.4 vs 10.1% exp and 10.2% last, with industrial output YoY at 6.2% and 6.0% exp and 6.1% last. Meanwhile, urban investment YoY stood at +7.2% vs 7.1% expected and 7.2% last.  The mixed data had a limited impact on the Australian Dollar, with the AUD/USD pair maintaining the bid tone near 0.7975 levels while AUD/JPY keeps its range near 88.70.  

China Fixed Asset Investment (YTD) (YoY) above forecasts (7.1%) in December: Actual (7.2%)

China Gross Domestic Product (QoQ) meets forecasts (1.6%) in 4Q

China Gross Domestic Product (YoY) above expectations (6.7%) in 4Q: Actual (6.8%)

China Industrial Production (YoY) registered at 6.2% above expectations (6%) in December

China Retail Sales (YoY) below expectations (10.1%) in December: Actual (9.4%)

Danske Bank’s analysts highlight the key market moving events/releases scheduled on Thursday.  Key quotes: “With no major euro area data releases on

Danske Bank’s analysts highlight the key market moving events/releases scheduled on Thursday. Key quotes:“With no major euro area data releases on the calendar, today's highlight will be speeches by Bundesbank President Jens Weidmann and ECB's Benoit Coeuré at a conference on economic policy debates in Germany. With recent ECB attempts to talk down the EUR over the last days markets will look out for any hints regarding future ECB monetary policy.” “In the US, the Philly Fed index for January is released. Consensus is for a decline to 24.0, in line with the observed drop in the earlier released Empire manufacturing index, but despite a possible moderation the index remains at a high level.”

FX option expiries for Jan 18 NY cut at 10:00 Eastern Time, via DTCC, can be found below. - EUR/USD: 1.2000 (EUR 2.4bn), 1.2100-05 (781m), 1.2180 (55

FX option expiries for Jan 18 NY cut at 10:00 Eastern Time, via DTCC, can be found below. - EUR/USD: 1.2000 (EUR 2.4bn), 1.2100-05 (781m), 1.2180 (553m), 1.2200 (549m), 1.2220(767m), 1.2300 (627m) - USD/JPY: 110.80 (USD 1.5bn), 111.00-05 (1.5bn), 112.50 (701m) - USD/CAD: 1.2400 (USD 570m), 1.2460 (780m) - NZD/USD: 0.7025 (NZD 2.0bn) - EUR/GBP: 0.8650 (EUR 860m), 0.8765 (862m)

Karen Jones, Analyst at Commerzbank, notes that the GBP bulls may face exhaustion now, but GBP/USD remains poised for a move towards 1.4000. Key Quot

Karen Jones, Analyst at Commerzbank, notes that the GBP bulls may face exhaustion now, but GBP/USD remains poised for a move towards 1.4000.Key Quotes:“GBP/USD spiked higher yesterday, various intraday divergences suggest consolidation ahead of a move to psychological resistance at 1.40. The market stays immediately bid above the 1.3495 2 month uptrend. We would allow for a retracement to 1.3730/1.3600 ahead of further gains.“ “Below the 1.3495 would retarget the 1.3291 2014-17 uptrend.” “The 2014-2017 downtrend line has been eroded to target the 1.3658/71 double Fibo. Above here would target 1.3836 the February 2016 low.”

The EUR/USD found bids around 1.2167 (38.2% Fib R of Sep. 9 low-Sep. 17 high) and jumped to a high of 1.2209 levels, suggesting strong buying interest

EUR/USD rebounds from 38.2% Fib, retakes 1.22 handle. Bearish outside day reversal to cap gains? The EUR/USD found bids around 1.2167 (38.2% Fib R of Sep. 9 low-Sep. 17 high) and jumped to a high of 1.2209 levels, suggesting strong buying interesting on dips. However, the spot is still at least 110 pips from the three-year high of 1.2323 set yesterday. Also, EUR/USD created a bearish outside day reversal yesterday. Commerzbank Analyst Karen Jones believes it could yield a temporary pullback to 1.2125-1.2075. Also, the markets may have overpriced (run ahead of themselves) near-term policy tightening by the ECB. ING says President Draghi is likely to convey a rather dovish message, pointing to still weak inflationary pressure and also emphasizing the disinflationary impact from a stronger euro. Most experts seem to agree that Draghi is likely to tame the hawks at the ECB. Thus, EUR bulls could have a tough time taking the pair back to a three-year high of 1.2323. As of writing, the currency pair is trading at 1.2202 levels. Across the pond, weekly jobless claims and housing data (building permits and housing starts) are scheduled for release.EUR/USD Technical LevelsA move above the upward sloping 5-day MA of 1.2222 would open doors for 1.2283 (Tuesday's doji candle high) and 1.23 (zero levels). On the downside, breach of support at 1.2167 (38.2% Fib R) could yield a pullback to 1.2119 (50% Fib R) and 1.2102 (10-day MA).  

Horst Seehofer, a German Conservatives Party (CSU) politician, said in an interview in Bild, the Social Democrats (SPD) rejection of the coalition wou

Horst Seehofer, a German Conservatives Party (CSU) politician, said in an interview in Bild, the Social Democrats (SPD) rejection of the coalition would be a catastrophe. No further comments were reported so far. 

Analysts at TDS offer a sneak peek at what to expect from today’s Chinese economic releases slated for release at 0700GMT. Key Quotes: “CNY Data del

Analysts at TDS offer a sneak peek at what to expect from today’s Chinese economic releases slated for release at 0700GMT.Key Quotes:“CNY Data deluge delayed until 3 pm Singapore time / 7 am London time. Q4 GDP expected to dip from 6.8% to 6.7% but with such strong PMIs for Dec risks lie towards another 6.8% print.  H1 was 6.9% and perhaps H2 6.8%. Govt target was 6.5% or better so well and truly "achieved.”

Bitcoin, the biggest and most traded cryptocurrency, consolidates its overnight recovery in a $ 1000 range just ahead of the $ 11k mark, as the dust s

Bitcoin, the biggest and most traded cryptocurrency, consolidates its overnight recovery in a $ 1000 range just ahead of the $ 11k mark, as the dust settles over the fears of the regulatory crackdown on the virtual currencies across Asia. The spot lost almost gave up 50% of its value from record peaks of near $ 20000 levels and fell to four digits on Tuesday at $ 9,231 after speculations mounted that South Korea and Chinese regulators are boosting their crackdown efforts to curb the digital currencies trading. All of its counterparts also reversing the recent sell-off, with Ethereum up +2.3%, Ripple rallying 20% while Bitcoin cash bounces 5% on the day, according to the CoinMarketCap data. The crypto markets appear to have ignored the latest South Korean headline, citing that the South Korean regulator is said to consider shutting down all virtual currency exchanges. Most industry veterans view the sell-off as a good buying opportunity while adding that the traders could still continue to trading the digital currencies by switching onto exchanges in the countries that haven’t banned the cryptocurrencies. Meanwhile, the cryptocurrency market cap also increased to $ 544 billion versus yesterday’s $503 billion. More than $200 billion has been wiped off the value of global cryptocurrencies over the last four trading sessions.

Netherlands, The Unemployment Rate s.a (3M) remains unchanged at 4.4% in December

The outcome of the latest Reuters poll on the BoJ’s monetary policy programme for this year, a majority of the economists polled see the BoJ keeping i

The outcome of the latest Reuters poll on the BoJ’s monetary policy programme for this year, a majority of the economists polled see the BoJ keeping its long-term interest rate target unchanged this year.Key Findings:“Around 40 percent predicted the BOJ would raise the target this year, but the rest either projected it would remain at zero in 2018 or left some future quarters blank, saying their outlook depended on who would be the new BOJ governor after Haruhiko Kuroda’s term ends in early April. Many economists didn’t foresee the Bank of Japan unwinding its massive stimulus this year, but 16 did. Two thought the central bank could begin cutting back in April, two said September, eight predicted October and four predicted December. Seventeen expected the wind down would begin in 2019 or later. Economists also largely thought the BOJ would continue - in its policy statements at least - to target an annual increase in its bond holdings of 80 trillion yen. 13 of 36 economists said Japan Govt could declare victory over deflation by end-2018.     Economists see North Korea tensions, China's economic outlook posing top risk factors for Japan.”

Forex today remained in a wait-and-see mode, with most majors consolidating the overnight moves while awaiting the Chinese macro releases. The Aussie

Forex today remained in a wait-and-see mode, with most majors consolidating the overnight moves while awaiting the Chinese macro releases. The Aussie nursed losses amid mixed Aus jobs data. The Yen traded better offered, as the US extended rebound across the board. Amongst the commodities, oil prices traded firmer on bullish API crude inventory report while gold prices kept losses below $ 1330 levels amid higher Treasury yields and positive Asian equities.Main topics in AsiaAustralia December employment change beats estimates, jobless rate ticks higher The data released by Australia Bureau of Statistics (ABS) showed the economy added 34.7K jobs in December vs. forecast of 9K.  BoJ officials reported as saying current stimulus is needed for now Bloomberg quoted an unnamed Bank of Japan (BoJ) official as saying that the current is needed for now while adding that the market is getting ahead of itself. White House Official: Congress will pass a stopgap bill to keep government funded According to the White House Chief of Staff Kelly, the US Congress will pass a stopgap bill to avert a government shutdown, Reuters reports. China's holdings of US treasuries fell to 4-month low in November China’s holdings of US Treasuries fell to $1.176 trillion in November, its lowest in four months. South Korean regulator considering shutting down all virtual currency exchanges Reuters reports the latest headlines, citing that the South Korean regulator is said to consider shutting down all virtual currency exchanges.Key Focus aheadWe have all-important China’s Q4 GDP release accompanied by the country’s industrial production and retail sales data, which will be reported at 0700 GMT (delayed by the source) while the EUR calendar remains data-empty. Hence, most majors will closely track the USD dynamics and risk trends ahead of the US building permits, housing starts, unemployment claims and Philly Fed manufacturing Index, all of which are due on the cards at 1330 GMT. Also in focus remains the German Bundesbank Chief Weidmann’s speech and EIA crude oil inventories data. EUR/USD: Will buyers regain control above 1.2200? The EUR/USD pair staged a solid comeback in Asia, having reversed from four-day lows of 1.2165. However, sellers continued to lurk just ahead of the 1.22 handle, leaving the rates in a consolidative phase below the last. GBP/USD - Rising risk reversals contradict widening 10Y US-UK yield spread Currently, GBP/USD trades at 1.3812 - down more than 100 pips from the previous day's high of 1.3943. The long upper shadow of yesterday's candle could be read as a sign of bull market exhaustion. When is China Q4 GDP and how could it affect the AUD/USD? China is set to publish the gross domestic product (GDP) for the fourth quarter at 07:00 GMT.  China: Key economic events today - Barclays The Barclays Research Team is out with a brief preview of their expectations on the upcoming Chinese macro releases due to be reported at 7GMT today.  

EUR/GBP fell below the 200-day MA yesterday, seemingly due technical failure at the 100-day MA. The pair spent the better part of the last week battl

Technical failure triggers sell-off. UK-German 10-yr spread favors EUR. EUR/GBP fell below the 200-day MA yesterday, seemingly due technical failure at the 100-day MA. The pair spent the better part of the last week battling offers around the 100-day MA, then positioned around 0.89 levels. However, the moving average proved a tough nut to crack. The repeated rejection at the key technical hurdle finally made way for the bears. The currency pair closed yesterday at 0.8808 and was last seen trading at 0.8825 levels. Despite being mildly bid, the cross is still below the 200-day MA level of 0.8832. That said, the drop does not look sustainable if we take into account the recent drop in 10Y UK-German yield spread (from 82.5 basis points to 73.6 basis points). The spot may recover above the 200-day MA if the spread drops further in the EUR positive manner.EUR/GBP Technical LevelsA break below 0.88 (zero levels) would open doors for 0.8761 (Dec. 14, Dec. 15 low), under which a major support is seen at 0.8689 (Dec. 8 low). On the higher side, breach of resistance at 0.8832 (200-day MA) would expose the 100-day MA of 0.8887 and 0.89 (zero levels).  

Comments from South Korean central bank are crossing the wires via Reuters- GDP growth is seen at 2.9 percent in 2019. Inflation is seen at 2 perc

Comments from South Korean central bank are crossing the wires via Reuters- GDP growth is seen at 2.9 percent in 2019. Inflation is seen at 2 percent in 2019. Robust exports and expanded consumption to fuel growth in 2018.  

Japan Industrial Production (YoY) above expectations (1.9%) in November: Actual (3.6%)

China Q4 GDP overview: China is set to publish the gross domestic product (GDP) for the fourth quarter at 07:00 GMT. The economy is seen expanding 1.

China Q4 GDP overview:China is set to publish the gross domestic product (GDP) for the fourth quarter at 07:00 GMT. The economy is seen expanding 1.6 percent quarter-on-quarter (q/q) and 6.7 percent year-on-year (y/y). The slight slowdown will most likely be due to the cooling property sector, China's crackdown on debt risks and factory pollution. Also, the growth rate would still be above China's annual growth target of around 6.5 percent. Also scheduled for release are industrial production (expected 6.0 percent y/y) and retail sales (expected 10.1% y/y).How could the data affect the AUD/USD?A better-than-expected China Q4 GDP could put a bid under the Aussie dollar. However, the AUD bulls look tired as the pair failed to cut through 0.80 in Asia despite upbeat Aussie data. So, a sustained move above 0.80 could be seen only if the forward-looking retail sales indicator betters estimates. Also, the uptick in factory output could boost the Aussie dollar. On the other hand, a weaker-than-expected data could yield a much needed technical correction in the AUD/USD pair.           China: Key economic events today - BarclaysAbout Chinese GDPThe Gross Domestic Product (GDP) released by the National Bureau of Statistics of China studies the gross value of all goods and services produced by China. The indicator presents the pace at which the Chinese economy is growing or decreasing. As the Chinese economy has an influence on the global economy, this economic event would have an impact on the Forex market. Generally speaking, a high reading is seen as positive (or bullish) for the CNY and AUD, while a low reading is seen as negative (or Bearish).

Japan Capacity Utilization registered at 0%, below expectations (0.1%) in November

Japan Industrial Production (MoM) below forecasts (0.6%) in November: Actual (0.5%)

The NZD/USD pair is seen consolidating the recovery seen so far this session, as the bulls await the Chinese economic releases for the next push highe

DXY rebound caps upside? All eyes on China data dump. The NZD/USD pair is seen consolidating the recovery seen so far this session, as the bulls await the Chinese economic releases for the next push higher.NZD/USD finds support near 10-DMA of 0.7240The Kiwi fails to extend its recovery further beyond the daily pivot located at 0.7285, as broad-based US dollar rebound regains poise amid higher Treasury yields and better US industrial figures. The USD index rises +0.11% to hit daily tops of 90.77, fast approaching the 91 handle. The recovery in the spot remains capped, as it tracks the losses seen in its OZ counterpart Aussie after AUD was hit by mixed Australian jobs data. Australia December employment change beats estimates, jobless rate ticks higherThe major witnessed good two-way businesses a day before, initially having dipped to 0.7235 levels before staging a solid recovery in a bid to clinch fresh four-month tops of 0.7332. However, the bulls failed to sustain the upmove and lost control in the overnight trades. Markets now eagerly await the Chinese Q4 GDP, industrial production and retail sales figures for fresh near-term trading opportunities.NZD/USD TechnicalsThe pair finds next resistances at 0.7315 (4-month tops), at 0.7350 (psychological levels), 0.7391 (classic R3). Meanwhile, the supports are located at 0.7240 (10-DMA), 0.7200 (zero figure) and 0.7174/53 (20 & 200-DMA).

As per US Energy Information Administration (EIA), the shale oil output is likely to rise by 1.8 million barrels per day (bpd) over the next year, mat

As per US Energy Information Administration (EIA), the shale oil output is likely to rise by 1.8 million barrels per day (bpd) over the next year, matching the volume of production cuts sustained by the OPEC, Russia and other major oil producing nations.  Also, the shale output in January is seen rising to 6.438 million barrels per day, which is 24,000 bpd higher than December levels.

Currently, GBP/USD trades at 1.3812 - down more than 100 pips from the previous day's high of 1.3943. The long upper shadow of yesterday's candle coul

GBP/USD risk reversals show GBP calls are in demand. 10Y US-UK yield spread hits 9-month highs, favors USD. Currently, GBP/USD trades at 1.3812 - down more than 100 pips from the previous day's high of 1.3943. The long upper shadow of yesterday's candle could be read as a sign of bull market exhaustion. However, one-month 25 delta risk reversals gauge rose to a four-month high of 0.30 yesterday, which indicates the dealers are still adding a premium for GBP calls. While the risk reversals highlight the bullish sentiment on the underlying (GBP), the yield differential tells a different story. The spread between the yield on the 10-year US treasury and its UK counterpart rose in the USD-positive manner to 127 basis points; the highest level since mid-April. Clearly, the rally in GBP/USD looks unjustified considering the widening US-UK yield differential. That said, the British Pound may continue to defy the unfavorable yield differential if the talk of the second Brexit referendum gathers pace.  GBP/USD Technical LevelsFXStreet Chief Analyst Valeria Bednarik writes, " The short-term picture for the pair is bullish, as in the 4 hours chart, the price bounced sharply after struggling with a bullish 20 SMA, holding near the mentioned high by the end of the US session. Technical indicators in the mentioned chart, are also supporting additional gains ahead with the RSI indicator heading higher within overbought territory and the Momentum also regaining the upside bouncing from its 100 level. Speculative interest seems determinate to test the 1.4000 threshold a possible bullish target for the upcoming session, should the greenback remain under pressure." Support levels: 1.3835 1.3800 1.3770  Resistance levels: 1.3895 1.3920 1.3960

More comments crossing the wires from the Chinese fx regulator, the Safe Administration of Foreign Exchange (SAFE), are found below. China's invest

More comments crossing the wires from the Chinese fx regulator, the Safe Administration of Foreign Exchange (SAFE), are found below. China's investments in the US treasury bonds are market driven. Recent Yuan appreciation driven by China's improving economy, weaker dollar. Two-way Yuan fluctuations will become a new normal. China will deepen forex reform, enhance Yuan flexibility.

The EUR/USD pair staged a solid comeback in Asia, having reversed from four-day lows of 1.2165. However, sellers continued to lurk just ahead of the 1

DXY rebound falters in Asia. German politics, ECB jawboning to keep upside limited. Eyes US macro news for fresh incentives. The EUR/USD pair staged a solid comeback in Asia, having reversed from four-day lows of 1.2165. However, sellers continued to lurk just ahead of the 1.22 handle, leaving the rates in a consolidative phase below the last. The spot is seen trying hard to retain the bids over the last hours, as upbeat US data-led rebound in the US dollar from multi-year lows versus its main peers loses steam. Expectations of higher global interest rates, as most major central banks are likely to join the Fed in normalizing their monetary policy this, continues to dampen the sentiment around the greenback On Wednesday, the main currency pair corrected sharply from its best levels since Dec 2014 at 1.2323, after markets used the excuse of the ECB officials’ jawboning the currency to book profits on their EUR longs, as attention now turns towards the ECB monetary policy decision due next week. ECB’s Nowotny: Euro exchange rate must be observed ECB’s Constancio: Worried about Euro moves that don't reflect fundamentals Meanwhile, the major showed limited reaction to the Eurozone final CPI numbers, which confirmed the flash estimate of 1.4% on an annualized basis. In the day ahead, markets eagerly await a fresh batch of macro news from the US docket for fresh impetus, as the EUR calendar remains data-dry. However, the speech by the German Bundesbank President Weidmann will be eyed in the European session.EUR/USD Technical LevelsFXStreet’s Chief Analyst, Valeria Bednarik, writes: “The 4 hours chart present some minor divergences, as the price is recovering after struggling around a bullish 20 SMA, but the Momentum indicator keeps heading lower around its 100 level, mostly due to the price being below its previous highs. Any possible upcoming decline should be considered corrective after the pair added roughly 400 pips pretty much straight, yet renewed buying interest above 1.2280 is now required to revert the short-term negative tone and consider higher highs ahead. Support levels:  1.2190 1.2155 1.2110. Resistance levels: 1.2280 1.2320 1.2350.”

USD/JPY remains bid in Asia but lacks the vigor to cut through 111.41 (38.2% Fib R of Jan. 1 high - Jan. 17 low) despite widening yield differential.

USD/JPY recovery stalls at 111.41 - 38.2% Fib. 10Y US-Jap spread hits at one-month high, favors upside in USD. USD/JPY remains bid in Asia but lacks the vigor to cut through 111.41 (38.2% Fib R of Jan. 1 high - Jan. 17 low) despite widening yield differential. The 10-year US-Japan yield spread rose to 266 basis points today; the highest level since Dec. 21. Also, previous day's bullish outside day candle indicates the pair has likely made a short-term bottom at 110.19. Further, the Bank of Japan (BOJ) officials believe the ultra-easy monetary policy is needed for now and are of the opinion that the markets have run ahead of themselves. Thus, unwinding of Yen longs may gather pace. Meanwhile, the USD could remain well bid as the Fed's Beige book (released yesterday) is said to have opened doors for a March rate hike.  Kathy Lien from BK Asset Management expects the USD/JPY to extend the rally to 112.00 regardless of today's housing reports and Philadelphia Fed index.USD/JPY Technical LevelsA move above 111.41 (38.2% Fib R of Jan. 8 high - Jan. 17 low) would expose 111.79 (50% Fib R) and 112.00 (zero levels). On the downside, breach of support at 110.95 (23.6% Fib R) could yield a sell-off to 110.19 (yesterday's low) and 110.00 (psychological support).  

Bloomberg quoted an unnamed Bank of Japan (BoJ) official as saying that the current is needed for now while adding that the market is getting ahead of

Bloomberg quoted an unnamed Bank of Japan (BoJ) official as saying that the current is needed for now while adding that the market is getting ahead of itself. Some BoJ officials see the need for future normalization talksKey Quotes:“A small shift is taking place in internal discussions among Bank of Japan policymakers, with a minority raising the need to eventually start discussing policy normalization, even though they agree the current stimulus program must continue unchanged for some time.” The BoJ two-day monetary policy meeting begins next week on Jan 22nd, with the policy verdict out on Jan 23rd.

The EUR/USD 1-month 25 delta risk reversals gauge rose to a 6-month high of 0.575 yesterday, indicating rising demand for EUR calls. The EUR/USD rose

The EUR/USD 1-month 25 delta risk reversals gauge rose to a 6-month high of 0.575 yesterday, indicating rising demand for EUR calls. The EUR/USD rose to a 3-year high of 1.2323 in Asia yesterday before the rally came to an abrupt end. The spot fell to 1.2177 yesterday. The bearish outside day candle indicates an increased risk of a deeper correction to 1.2092 -- 38.2% retrace of the 1.1718 to 1.2323 (December to January) rise. However, the uptick in the risk reversals shows investors expect EUR/USD to make a quick recovery from the technical pullback. Only a close below 1.20 could revive the demand for the EUR puts.Risk reversals 

According to the results of the latest Reuters poll of 75 economists, all of them see the BOE keeping rates on-hold, when it meets next week to decide

According to the results of the latest Reuters poll of 75 economists, all of them see the BOE keeping rates on-hold, when it meets next week to decide on its monetary policy.Key Findings:All 75 economists polled expect BOE to leave bank rate at 0.50 pct. Next rate move expected in q4 2018, a 25 basis point hike (same as December poll). Median 15 pct chance of the UK recession this year (20 pct in December poll). The UK economy to grow 1.4 pct in 2018; 1.5 pct in 2019 (1.3; 1.5 in December poll). Median 20 pct chance of disorderly Brexit (25 pct in December poll).  

Headlines crossed the wires (via Reuters) from China’s fx regulator, the Safe Administration of Foreign Exchange (SAFE), citing: Commercial Banks Pur

Headlines crossed the wires (via Reuters) from China’s fx regulator, the Safe Administration of Foreign Exchange (SAFE), citing: Commercial Banks Purchase Net $6Bln Of Forex In Dec Vs Net Sale Of $7.5Bln In Nov. Commercial Banks Sell Net $111.6Bln Of Forex In 2017.

Australia HIA New Home Sales (MoM) increased to 0.7% in October from previous -6.1%

The Barclays Research Team is out with a brief preview of their expectations on the upcoming Chinese macro releases due to be reported at 7GMT today.

The Barclays Research Team is out with a brief preview of their expectations on the upcoming Chinese macro releases due to be reported at 7GMT today.Key Quotes:“We expect industrial production growth to remain broadly stable, at 6.1%, in December, as signaled by solid manufacturing PMIs. We forecast fixed asset investment growth will moderate to 7.1% in December, with recovering manufacturing investment partially offsetting an expected slowdown in infrastructure and real estate investment. Growth in retail sales is likely to remain above 10% despite some moderation in auto sales. We view strong exports, robust consumption, and slow but solid investment growth as presenting upside risks to our GDP growth forecast of 6.3% q/q saar (or 6.7% y/y) for Q4 17.”

According to the White House Chief of Staff Kelly, the US Congress will pass a stopgap bill to avert a government shutdown, Reuters reports.

According to the White House Chief of Staff Kelly, the US Congress will pass a stopgap bill to avert a government shutdown, Reuters reports.

China’s holdings of US Treasuries fell to $1.176 trillion in November, its lowest in four months. The world's largest holder of US treasuries had adde

China’s holdings of US Treasuries fell to $1.176 trillion in November, its lowest in four months. The world's largest holder of US treasuries had added $1.189 trillion in October, showed the Treasury's latest capital flows data.  Also, Japan, the second largest holder of US Treasuries, also cut its holdings by 9.9 billion dollars to 1.0841 trillion dollars.  The drop in the treasury holds supports the notion that foreign central banks are looking to cut back their dollar exposure.  However. China's State Administration of Foreign Exchange (SAFE), recently dismissed reports that China was considering slowing down or even halting its purchase of U.S. securities.

Reuters reports the latest headlines, citing that the South Korean regulator is said to consider shutting down all virtual currency exchanges. No fur

Reuters reports the latest headlines, citing that the South Korean regulator is said to consider shutting down all virtual currency exchanges. No further details have been provided on the same.

The EUR/JPY pair has been restricted to a 100-pip range (135.00-136.00) comprised of spinning top-like candles, suggesting the rally from the Jan. 11

EUR/JPY stuck in a 100-pip range (135.00 to 136.00). A high probability of a downside break as indicated by spinning top-like candles. The EUR/JPY pair has been restricted to a 100-pip range (135.00-136.00) comprised of spinning top-like candles, suggesting the rally from the Jan. 11 low of 133.02 may have run out of steam. The EUR bulls failed to take out 136.00 in a convincing manner in the last three trading days seemingly due to comments from ECB officials this week, highlighting concerns regarding the speed of the rise in the EUR. Meanwhile, the downside has been capped around 135.00 levels, largely due to persistent demand in the USD/JPY pair around/below 111.00 levels. As of writing, the currency pair is trading at 135.70. The spinning top-like candles indicate bulls are losing interest, given the pattern is found at the top of the uptrend. Hence, downside break of the 100-pip range is more likely. The struggle for direction may come to an end later today following the release of the Japanese industrial production data. Also, Bundesbank President Weidmann speech could influence EUR pairs.EUR/JPY Technical levelsAn upside break of the trading range (135.00-136.00) would open doors for 136.64 (Jan. 5 high) and 137.00 (target as per the measured height method). On the downside, breach of support at 135.00 could yield a sell-off to 134.00 (target as per the measured height method) and 133.69 (50-day MA).  

China House Price Index increased to 5.3% in December from previous 5.1%

The People's Bank of China (PBOC) set the Yuan reference rate at 6.4401 vs. 6.4335.

The People's Bank of China (PBOC) set the Yuan reference rate at 6.4401 vs. 6.4335.

South Korea BoK Interest Rate Decision remains unchanged at 1.5% in January

The Australian Bureau of Statistics (ABS) reported better-than-expected December employment change figures, but the Aussie dollar is not impressed. T

AUD/JPY offered near 89.00 levels. Fails to hold above 88.690 - 76.4% Fib R of Sep-Nov drop. Aussie Dec employment change beats estimates, jobless rate rises. The Australian Bureau of Statistics (ABS) reported better-than-expected December employment change figures, but the Aussie dollar is not impressed. The AUD/JPY ran into offers 88.97 and hit a session low of 88.41 even though the ABS data showed more than 34K jobs were created across Australia last month, beating the estimated growth of 9K by a big margin. Also, the previous month's print was revised higher to 63.6K from 61.6K. Further, full-time employment change came in at 15.1k versus the upwardly revised 43.6k in November. However, the jobless rate ticked higher to 5.5 percent from 5.4 percent as expected. Still, the AUD is trading on the back foot. The Aussie 10-year yield has backed off from the session high of 2.81 percent to 2.78 percent. The price action indicates the upbeat jobs number has failed to overshadow the uptick in the jobless rate. Further, a sharp slowdown in the full-time jobs growth could have played a role in pushing the Aussie lower.AUD/JPY Technical LevelsAs of writing, the currency pair is trading at 88.45. A move below 88.41 (session low + Jan. 2 and Jan. 16 high) would expose 88.16 (10-day MA) and 88.03 (61.8% Fib R of Sep-Nov drop). On the higher side, a break above 88.52 (resistance on 1-hour chart) would open doors for re-test of 88.90 (76.4% Fib R) and 89.00 (zero levels).

Analysts at Nomura offered their model's projection for today's USD/CNY fix. Key Quotes: "Our model1 projects the fix to be 60 pips higher than the

Analysts at Nomura offered their model's projection for today's USD/CNY fix.Key Quotes:"Our model1 projects the fix to be 60 pips higher than the previous fix (6.4395 from 6.4335) and 70 pips higher than the previous official spot USD/CNY close of 6.4325. The basket implied change is 82 pips higher than the previous official spot USD/CNY close (6.4407 from 6.4325)."

AUD/USD rallied on the back of the seasonally adjusted results in the Aussie jobs data listed below. AUD/USD rallied form 0.7961 to 0.7995 only. Curre

AUD/USD rallied on the back of the seasonally adjusted results in the Aussie jobs data listed below. AUD/USD rallied form 0.7961 to 0.7995 only. Currently, AUD/USD is trading at 0.7964, down -0.38% on the day, having posted a daily high at 0.7997 and low at 0.7953. Seasonally adjusted results in the Aussie jobs data: Employment Change +34,700, (expected 15.0K, prior revised higher to 63.6K from 61.6K). Unemployment Rate 5.5%, miss, (expected 5.4%, prior 5.4%).   Full Time Employment Change +15.1K, (prior was 43.6K, revised up from 41.9K). Part Time Employment Change +19.5K, (prior was 20K, revised up from 19.7K). Participation Rate at 65.7% was higher than the expected is 65.5% and the prior was 65.5%.  AUD/USD was a heavy offer at 0.8023 on a strong bid from 0.7943 overnight that might get another look into on the Chinese data dump later in the Asian session if it comes as positive and giving the green light to traders to continue to bid up the Aussie in a climate of a solf greenback. Further along the 0.80 handle comes the 0.8061 200 month moving average ahead of the 0.8125 Sep high. Chinese economic growth set to decelerate in Q4AUD/USD levelsValeria Bednarik, chief analyst at FXStreet explained that the pair is technically bullish, and readings in the 4 hours chart support additional gains ahead: "The pair bounced again from a bullish 20 SMA, while technical indicators resumed their advances, the Momentum from above its 100 level and the RSI currently entering overbought conditions." To the downside, however, the hourly 100 SMA located at 0.7942 has been a supportive line within the rising channel from 0.7848 recent lows where traders could target on a break of 0.7870.

The data released by Australia Bureau of Statistics (ABS) showed the economy added 34.7K jobs in December vs. forecast of 9K. The previous month's pri

The data released by Australia Bureau of Statistics (ABS) showed the economy added 34.7K jobs in December vs. forecast of 9K. The previous month's print was revised higher to 63.6K from 61.6K. Full-Time employment change came in at 15.1k in December versus 41.9k in November. Meanwhile, the jobless rate rose to 5.5 percent from 5.4 percent.   December Key Points (Source: ABS)TREND ESTIMATES (MONTHLY CHANGE) Employment increased 25,000 to 12,419,800. Unemployment increased 100 to 715,000. The unemployment rate decreased by less than 0.1 pts to 5.4%. Participation rate remained steady at 65.5%. Monthly hours worked in all jobs increased 4.0 million hours (0.2%) to 1,738.4 million hours.SEASONALLY ADJUSTED ESTIMATES (MONTHLY CHANGE) Employment increased 34,700 to 12,440,800. Full-time employment increased 15,100 to 8,518,900 and part-time employment increased 19,500 to 3,921,800. Unemployment increased 20,500 to 730,600. The number of unemployed persons looking for full-time work increased 9,900 to 501,800 and the number of unemployed persons only looking for part-time work increased 10,600 to 228,800. Unemployment rate increased 0.1 pts to 5.5% Participation rate increased by 0.2 pts to 65.7%. Monthly hours worked in all jobs decreased 4.2 million hours (0.2%) to 1,736.4 million hours.

Australia Part-time employment declined to 19.5K in December from previous 19.7K

Australia Employment Change s.a. above forecasts (9K) in December: Actual (34.7K)

Australia Participation Rate came in at 65.7%, above forecasts (65.4%) in December

Australia Fulltime employment fell from previous 41.9K to 15.1K in December

Australia Unemployment Rate s.a. came in at 5.5%, above expectations (5.4%) in December

USD/USD fading in Tokyo. All eyes on BoJ. The yen was sold off hard through the 111 handle to a reach a low of 111.27 vs the greenback overnight, wi

USD/USD fading in Tokyo. All eyes on BoJ. The yen was sold off hard through the 111 handle to a reach a low of 111.27 vs the greenback overnight, with USD/JPY extending the recovery lows from the previous day's low of 110.19. Currently, USD/JPY is trading at 111.27, up 0.12% on the day, having posted a daily high at 111.41 and low at 111.09. The dollar was mixed against the G10 while US stocks made big gains and fresh new all time highs. The DXY reached a fresh 3-year low at 90.11 before recovering to 90.81 the high for the NY session before sinking back to 90.22 before closing at 90.73. As for data, US industrial data was 0.9% higher in December after a downwardly revised 0.1% decline in November. We also had some Fed speak, who are generally optimistic and hawkish. Fed's Kaplan: Need to move 'gradually, deliberately' to raise rates this year Fed's Evans: U.S. economy continues to do extremely well Crypto Today: Bleeding in crypto space continues, market cap drops below $500 billion Fed's Beige Book: Most Fed districts reported modest-to-moderate price growth since last report Wall Street closes day with substantial gains Analysts at Westpac noted that US yields rose slightly, though much of the increase played out ahead of US trading, both 2 and 10yr yields rising about 2.5bp to 2.15% and 2.56% respectively. "Firmer risk appetite (S&P500 +0.7%) and signs that Republicans are close to passing a stopgap bill to keep the US government open beyond this Friday appear to have been the main drivers," the analysts added. All eyes on BoJMeanwhile, all eyes are on next week's BoJ meeting. We have already heard from BOJ Governor, Kuroda, although markets have been paying little heed to him as he reiterated his commitment to continue to pursue policies that will push inflation toward the 2% target. Nonetheless, analysts at Nomura explained that market expectations for BOJ normalisation have been rising gradually, putting downward pressure on yen-crosses. "While expectations for immediate policy change at next week’s meeting are low, Governor Kuroda’s press conference will be crucial. We expect him to keep his dovish stance unchanged, trying to calm market speculation about near-term tightening. A relief rally in USD/JPY is likely if Governor Kuroda confirms a low possibility of imminent policy change," the analysts argued.USD/JPY levelsValeria Bednarik, chief analyst at FXStreet explained that after rallying straight from 101.18 to 118.66 by the end of 2016, the pair began a corrective movement that bottomed last August at the 61.8% retracement of the mentioned rally.  "The 23.6% retracement of such rally at 114.56 to be precise, has been a major cap all through the year, and while the price trades near this last, there's no catalyst at sight that could actually trigger such bullish breakout.  Still, the pair could enter a bullish market only on a steady advance beyond the mentioned 2017 high at 118.60. To confirm a bearish trend, on the other hand, the key is the 108.00 region that could open doors for a steady decline towards the 105.00 price zone" Valeria added.

South Korea BoK Interest Rate Decision remains unchanged at 1.5% in January

Japan Industrial Production (YoY) above expectations (1.9%) in November: Actual (3.7%)

United Kingdom RICS Housing Price Balance above expectations (0%) in December: Actual (8%)

Australia Consumer Inflation Expectation unchanged at 3.7% in January

Analysts at ANZ noted the recent factors relating to NZD/USD. Key Quotes: "Other than a market that still appears to be short, it is hard to deduce

Analysts at ANZ noted the recent factors relating to NZD/USD. Key Quotes: "Other than a market that still appears to be short, it is hard to deduce a catalyst for the kiwi’s latest move. But it came storming back overnight, and the bias remains for further tests higher as it displays ‘beach ball under water’ properties. Support 0.7140 Resistance 0.7340."

Japan Foreign investment in Japan stocks down to ¥498.7B in January 12 from previous ¥597.9B

Japan Foreign bond investment rose from previous ¥173B to ¥953.5B in January 12

Overview of Australian jobs report (Dec) Australia's monthly jobs report is back on the cards for Asian markets today. The report will be released at

Overview of Australian jobs report (Dec) Australia's monthly jobs report is back on the cards for Asian markets today. The report will be released at 1230 GMT.  Following an outsized gain of 62k in November, Australia’s December labour force survey is eagerly anticipated, noted analysts at Westpac: "Annual employment growth looks to have overshot the forward indicators and so we anticipate a modest decline of 10k jobs in the month. The market is more optimistic, forecasting a further 15k gain. A positive outcome would make this the equal longest period without a decline in the survey’s history – matching the 15 months starting May 1993. Little change in the unemployment rate is anticipated in December, 5.5% from 5.4% in November."How could the data affect AUD/USD?AUD/USD fell from a fresh tend high at 0.8022 that would deserve another look into on a positive outcome in the report while traders will then look ahead to the Chinese data dump later in the Asian session. Further along the 0.80 handle comes the 0.8061 200 month moving average ahead of the 0.8125 Sep high. To the downside, the hourly 100 SMA located at 0.7941 has been a supportive line within the rising channel from 0.7848 recent lows where traders could target on a break of 0.7870.Key notesAUD/USD analysis: breaking higher ahead of key Australian employment data AUDUSD: Stand aside and go with the flow after the data Forex today: a mixed and busy session, GBP, CAD and NZD stole the show Chinese economic growth set to decelerate in Q4About the Employment ChangeThe Employment Change released by the Australian Bureau of Statistics is a measure of the change in the number of employed people in Australia. Generally speaking, a rise in this indicator has positive implications for consumer spending which stimulates economic growth. Therefore, a high reading is seen as positive (or bullish) for the AUD, while a low reading is seen as negative (or bearish).

Analysts at ANZ explained that the deadline to avoid a US government shutdown is once again fast approaching (January 19), and has perhaps been one fa

Analysts at ANZ explained that the deadline to avoid a US government shutdown is once again fast approaching (January 19), and has perhaps been one factor – even if only at the margin – that has seen the market shun the USD of late. Key Quotes:"A full shutdown would of course have economic consequences, with history serving as a reasonable guide on this. However, there were reports overnight that plans to avoid this shutdown had gained a little momentum, even if they were again really only stopgap in nature (extending funding for only four weeks) and involved scuttling plans to do a deal with House Democrats on immigration. But the success of the plan was still far from assured, as it would still need some Democrat support in the Senate. Chances are a deal will be reached, but as it is just the case of kicking the can down the road, it does look like we will be in this same position again in a month’s time."

Crude oil prices extended daily gains in the post-settlement trade with the barrel of West Texas Intermediate rising above the $64 mark. As of writing

Crude oil prices extended daily gains in the post-settlement trade with the barrel of West Texas Intermediate rising above the $64 mark. As of writing, the barrel of WTI was trading at $64.05, adding 0.5% on the day. Following the rally that extended to a fresh three-year high at $64.90 on Monday, the WTI made a technical correction on Tuesday and dropped below the $64 mark. However, the bearish pressure faded away with no fundamental developments strengthening it on Wednesday and the weekly API report provided an additional boost to lift the WTI back above $64. Crude oil inventories in the U.S. decreased by 5.1 million barrels to 411.5 million in the week ending January 12 according to the weekly report released by the American Petroleum Institute. Further details of the report showed that refinery crude runs fell by 420,000 barrels per day while gasoline stocks rose by 1.8 million barrels. On Thursday, the EIA is going to publish its weekly report, which is expected to show a decrease of 3.6 million barrels in crude oil inventory in the U.S. A larger-than-expected draw is likely to help the WTI challenge the critical $65 handle.