1-888-998-3948


Wednesday, March 13, 2019

Sterling bid after Theresa May loses 2nd meaningful Brexit vote yesterday. "No deal" Brexit vote on deck at 3pmET today.

Sterling bid after Theresa May loses 2nd meaningful Brexit vote yesterday.
Source: Powered by Exchange Bank of Canada - www.ebcfx.com/news

Summary

  • USDCAD: Dollar/CAD is trading steady this morning, but still with an offered tone after weak US CPI figures and a last minute bid in oil prices yesterday saw the market slip below chart support in the 1.3370s.  Next up are the US PPI figures for February and the US Durable Goods numbers for January.  Traders are expecting +0.2% MoM on the former and -0.5% MoM on the latter.  April crude oil prices are trading up 1% this morning after last night’s weekly API report showed a surprise draw in crude inventories (-2.58M barrels vs +2.87M expected).  Today’s session features the weekly EIA oil inventory report at 10:30amET, where traders are expecting a build of +2.82M barrels.  We think USDCAD is at risk of slipping much lower here should the market not be able to recover above the 1.3370s in short order.  The next support levels come in at the 1.3330s, then the 1.3290s.

  • EURUSD: Euro/dollar is moderately bid this morning, but the market continues to struggle at trend-line resistance at the 1.1300 level.  Eurozone Industrial Production for January beat expectations (+1.4% MoM vs +1.0% expected), but traders quickly sold the knee-jerk 10pt pop in prices following the headline.  While we think yesterday’s US CPI-driven rally above the 1.1270s now puts the EUR short thesis into question, we think the market needs to do more here to convince the funds to cover.  A strong close above the 1.1300 level could be pivotal as it would improve the market’s technical structure.  The ECB’s Coeure will be speaking today at 1pmET.

  • GBPUSD: Sterling is up almost 100pts this morning from the NY close yesterday, and while one could argue this doesn’t make much sense given another defeat for Theresa May and her Brexit plan in UK Parliament yesterday, this outcome was largely expected by traders.  The market was also not able to break intra-day support in the 1.3050s following the news, which we think then forced some shorts to cover.  GBPUSD has been drifting higher ever since, despite lots of tough talk out of Brussels today about the ball being in the UK’s court, about the EU being prepared for a “no-deal” outcome, and about the UK having to explain why it would need an Article 50 extension.  Headlines have just crossed saying UK Attorney General Cox will not be changing his legal opinion on the EU’s Brexit assurances with regard to the Irish backstop (yesterday’s bearish news).  Parliament will now vote at 3pmET today on whether or not the UK should leave the EU without a deal (traders are expecting this motion to be defeated).

  • AUDUSD: The Australian dollar is erasing most of yesterday’s gains today after Australia reported a disappointing Westpac Consumer Confidence number for March (-4.8% vs -1.3% expected).  Buyers have stepped in at chart support at the 0.7050s however, and seem content to follow EURUSD higher here as NY trade gets underway.  Expect the US PPI and Durable Goods figures out shortly to set the broader USD tone for the session.  China reports its February Industrial Production figures tonight at 10pmET.

  • USDJPY: Dollar/yen continues to hang in there, after traders held the 111.10s and US equity markets shrugged off the weak US CPI report yesterday.  The S&Ps are extending gains this morning, which is helping USDJPY push up to yesterday’s highs.  We think this optimism could extend further, provided we get decent US Durable Goods data this morning.

Tune in @EBCTradeDesk for more real-time market coverage.

 

Market Analysis Charts

USD/CAD Daily Chart

USD/CAD Hourly Chart

April Crude Oil Daily Chart

EUR/USD Daily Chart

EUR/USD Hourly Chart

USD/CNH Daily Chart

GBP/USD Daily Chart

GBP/USD Hourly Chart

EUR/GBP Daily Chart

AUD/USD Daily Chart

AUD/USD Hourly Chart

May Copper Daily Chart

USD/JPY Daily Chart

USD/JPY Hourly Chart

June S&P 500 Daily

Charts: TWS Workspace


About the Author

Erik Bregar

Erik Bregar - Director, FX Trading

linkedin twitter

Erik works with corporations and institutions to help them better navigate the currency markets. His desk provides fast, transparent, and low cost trade execution; up to the minute fundamental and technical market analysis; custom strategy development; and post-trade services -- all in an effort to add value to your firm’s bottom line. Erik has been trading currencies professionally and independently for more than 12 years. Prior to leading the trading desk at EBC, Erik was in charge of managing the foreign exchange risk for one of Canada’s largest independent broker-dealers.

Interested in creating a custom foreign exchange trading plan? Contact Us or call CXI's trading desk directly at 1-833-572-8933.

About Currency Exchange International
Currency Exchange International (CXI) is a leading provider of foreign currency exchange services in North America for financial institutions, corporations and travelers. Products and services for international travelers include access to buy and sell more than 90 foreign currencies, multi-currency cash passports, traveler's cheques and gold bullion coins and bars. For financial institutions and corporations, our services include the exchange of foreign currencies, international wire transfers, global EFT, the purchase and sale of foreign bank drafts, international traveler's cheques, and foreign cheque clearing through the use of CXI's innovative CEIFX web-based FX software www.ceifx.com

Disclaimer: All product names, logos, and brands are property of their respective owners. All company, product and service names used in this website are for identification purposes only. Use of these names, logos, and brands does not imply endorsement.

This publication has been prepared by Currency Exchange International for informational and marketing purposes only. Opinions, estimates and projections contained herein are our own as of the date hereof and are subject to change without notice. The information and opinions contained herein have been compiled or arrived at from sources believed reliable, but no representation or warranty, express or implied, is made as to their accuracy or completeness and neither the information nor the forecast shall be taken as a representation for which Currency Exchange International, its affiliates or any of their employees incur any responsibility. Neither Currency Exchange International nor its affiliates accept any liability whatsoever for any loss arising from any use of this information. This publication is not, and is not constructed as, an offer to sell or solicitation of any offer to buy any of the currencies referred to herein, nor shall this publication be construed as an opinion as to whether you should enter into any swap or trading strategy involving a swap or any other transaction. The general transaction, financial, educational and market information contained herein is not intended to be, and does not constitute, a recommendation of a swap or trading strategy involving a swap within the meaning of U.S. Commodity Futures Trading Commission Regulation 23.434 and Appendix A thereto. This material is not intended to be individually tailored to your needs or characteristics and should not be viewed as a "call to action" or suggestion that you enter into a swap or trading strategy involving a swap or any other transaction. You should note that the manner in which you implement any of the strategies set out in this publication may expose you to significant risk and you should carefully consider your ability to bear such risks through consultation with your own independent financial, legal, accounting, tax and other professional advisors. All Currency Exchange International products and services are subject to the terms of applicable agreements and local regulations. This publication and all information, opinions and conclusions contained in it are protected by copyright. This information may not be reproduced in whole or in part, or referred to in any manner whatsoever nor may the information, opinions and conclusions contained in it be referred to without the prior express written consent of Currency Exchange International.
Posted By Jennifer Danuff at 08:15 AM
comments powered by Disqus

Platinum Passport

Travelers: Never miss a thing and be the first to know about CXI branch promotions, travel tips and hot trends.

Currency Insider

Corporations & Financial Institutions: Want to get ahead of the curve for the upcoming week? Get CXI's currency market trend analysis sent directly to your inbox weekly.