Bill Baruch, president and founder of Blue Line Futures, reviews and previews the euro, Japanese yen, Chinese yuan, Aussie and Canadian and the upcoming economic report calendar. Follow his reports Monday-Friday on MoneyShow.com and short Midday Markets video.

Bill Baruch’s Midday Market Minute short video for Oct 23 here.
Is the bottom near for Crude and stocks Tuesday, asks Bill Baruch. Equities are getting slammed. Crude is biggest loser of the day, more than $3.

Euro (December)

Session close: Settled at 1.1517, down 44 ticks.

Fundamentals: Despite a strong start to the week, the euro slipped sharply into U.S. hours and finished down 0.4%. Moody’s downgraded Italy’s credit rating on Friday but stopped short of calling it junk, bringing a wave of relief to the euro in early trading hours.

However, the excitement quickly dissipated after the country sent a letter to Brussels, saying it stands by its 2.4% budget deficit in 2019. The EU is expected to officially ask Italy to revise its budget on Wednesday. The British pound also weighed on the region’s currencies as Brexit drags and British Prime Minister May faces criticism.

Though the economic calendar was bare to start the week, the German Bundesbank said in its Monthly Report that third quarter may have stalled due to transitory effects tied to new emissions regulations for carmakers. Ultimately, the U.S. dollar grinded higher despite a string of poor housing data in the back half of last week.

Technicals: The euro has struggled and held at all the technically significant levels. First, the tape stopped at ...

 

Economic calendar

Thursday on the calendar we are eyeing the ECB meets early and new Fed Vice Chair Clarida speaks in the afternoon.

Tomorrow, German PPI is due at 2:00 am EDT, Minneapolis Fed President Kashkari speaks at 9:30 am EDT, Richmond Manufacturing is due at 10:00 am EDT along with Eurozone Consumer Confidence and Atlanta Fed President Bostic speaks at 1:30 pm EDT.

 

Yen (December)

Session close: Settled at .89005, down 18 ticks.

Fundamentals: The yen has slowly made its way south, extending to a two-week low upon a strong move in Asian equity markets overnight. The Shanghai Composite gained 4.1% and though some of that excitement dissipated during U.S. hours, the yen failed to respond; it bottomed at 5:30 am EDT and stayed within a quarter point of its low.

The U.S. dollar has begun exhibiting some safe-haven attributes despite disappointing data to round out last week and traders want to keep an eye on this leading to further losses for the yen.

If China tracks U.S. equity volatility from today’s session though, one would imagine the yen finds its footing. Bank of Japan Core CPI is due out at 1 am EDT.

Technicals: The yen failed at first key resistance one week ago and now finds itself facing major three-star support at .... 

 

Aussie (December)

Session close: Settled at .7087, down 35 ticks.

Fundamentals: The Aussie opened the week lower on political uncertainties with the Liberals losing their majority in parliament. The currency found additional pressures through U.S. hours as risk-on sentiment scattered a bit and the U.S. dollar firmed. Tonight, RBA Assistant Governors Debelle, Bouton and Bullock all speak, and this should bring some volatility amidst such uncertainty. Traders should also keep an eye on the Shanghai Composite which roared higher today after President Xi promised “unwavering” support for the private sector. If the market gives back today’s gains, it could easily drag the Aussie along.

Technicals: Price action finds itself tied to our pivot level at ... 

 

Canadian (December)

Session close: Settled at .76395, up 8 ticks.

Fundamentals: The Canadian dollar notched a green session in a tough environment; the U.S. dollar firmed in what seemed to be more of a safe-haven grind, energies did not perform and U.S. equities bled away a bulk of the overnight gains.

The Bank of Canada meets on Wednesday and the market is pricing in about a 90% chance they hike rates to 1.75% from 1.50%. With NAFTA assumingly tied down, a strong employment report and healthy business confidence the message delivered by the BoC will be what’s most important.

Today, Wholesale Inventories missed expectations and our general feeling is that many data points have fallen short of expectations recently. However, we find this as a reason to believe there is better upside with the data being held back by trade uncertainties. We like the Canadian to trade higher this week.

Technicals: The Canadian is holding major three-star support and this level is now even stronger that ... 

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Bill Baruch’s Midday Market Minute short video for Oct. 22 here.
S&P was up 15 points before the market opened, then you started to see selling. Stocks stumble Monday as earnings loom throughout the week. Nasdaq leading the way today.

Bill Baruch's Morning Express for Oct. 22 here.

View a short video: Bill Baruch: Trading Futures. Gold, USD, yuan.

Recorded: TradersExpo Chicago July 24, 2018.

Duration: 4:34.