Daily forex rundown: Euro, yen, Aussie & CAD

Euro (March)

Session close (Thursday, Mar. 1): Settled at 1.22655, up 48.5 ticks

Fundamentals: The U.S. dollar sold off this afternoon, losing about 0.5% from session highs on newly imposed tariffs on aluminum and steel imports. This news crowded the headlines and overshadowed Fed Chair Powell’s congressional testimony. The euro traded to a session low of 1.2166 as Powell began, but reversed sharply in an outside-bullish reversal session. He said that there was no evidence that the U.S economy was overheating and commented directly on the possibility of tariffs as the news of a meeting in the White House gained traction, “the tariff approach is not the best approach,” he said. Lost in much of Thursday’s noise was a comment from voting member NY Fed President Dudley that four rate hikes this year is gradual. The dollar gained midweek after what we called a strong tone from Powell on Tuesday. Ultimately, his tone has paved the way for Fed officials to become more vocal with their opinions than they were under Chairwoman Yellen; seen directly here with Dudley. Weekly Jobless Claims came in at a 48-year low and ISM Manufacturing beat. Tomorrow will be quieter on the data front with the second read on Michigan Consumer data. 

Technicals: Yesterday we discussed the importance of Thursday’s closing price. While yesterday’s weak action signaled a likely breach of major three-star support, we discussed a close back above here would give us the argument to go long. Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels. 

Yen (March)

Session close: Settled at .9420, up 34 ticks

Fundamentals: After an early session dip, the Yen regained unchanged on a toppy dollar trade and choppy equity market. However, the yen picked up steam as both the dollar and equities plunged in the afternoon. Yesterday, we discussed how constructive the Yen trade was and once again went outright Bullish in Bias. As long as the equity market remains choppy to lower, the Yen will see safe-haven buying. Gold reversed sharply from strong support near the $1300 mark while the 10-year Treasury traded to the highest level since Feb. 9. All signal that the path of least resistance is higher in the yen. Household Spending, Unemployment Rate and Tokyo CPI are all due at 5:30 p.m. Central. 

Technicals: The Yen traded to a new high on the week, taking out first resistance. Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

Aussie (March)

Yesterday’s close: Settled at .7759, down 19 ticks

Fundamentals: The Aussie was technically hanging by a string on yesterday’s close, that string broke last night after Private New Capital Expenditure data came in at -0.2% when +0.9% was expected. Price action reversed sharply on the path of the U.S dollar and gives bulls some hope. Last night Caixin Manufacturing read out of China was better than expected, offsetting some of the worries from the poor Manufacturing PMI read Tuesday night. Tonight, is HIA New Homes Sales from Australia at 6:00 p.m. Central. 

Technicals: Price action traded to a session low of .7713 but reversed to hold major three-star support upon settlement… Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

Canadian (March)

Session close: Settled at .7797, up 1 tick

Fundamentals: The Canadian was able to stop its recent bleeding upon a weaker U.S dollar and a stable crude oil market. The picture was ugly early as it was down 0.5% and crude was starring at $60 per barrel. Thursday’s reversal gives some hope for a bounce, but a choppy equity market trade might stand in the way. However, a lot will ride on tomorrow’s GDP read from Canada. 

Technicals: The session low tested and held into major three-star support, however, there is a long way to go to break this downtrend. Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

About the Author

Bill Baruch is President and founder of Blue Line Futures, a leading futures and commodities brokerage firm. Bill has more than a decade of trading experience and focuses on developing trading strategies for both long and short-term trading approaches. Prior to Blue Line, Bill was the Chief Market Strategist at iiTRADER.  Bill is a featured expert on CNBC, Bloomberg and the Wall Street Journal as well as other top tier publications. Blue Line Futures offers five research reports each day with the Blue Line Express