Major Economic Data to keep an eye on:
We have a busy schedule this morning. Make sure to keep track of economic news related to your open positions.
CHF – Swiss CPI (MoM+YoY) – 8:15 GMT
EUR – German Factory Orders (MoM) – 11:00 GMT
CAD – Housing Starts – 13:15 GMT
CAD – Trade Balance – 13:30 GMT
USD – Redbook (MoM + YoY) – 13:55 GMT
CHF – SNB Chairman Thomas Jordan speaks – 17:00 GMT
U.S equities had a poor start for the week Monday and the same we can definitely say for the politics in Washington.
The prominent fear is that U.S is on a path to default, unless we see some intervention and negotiate over the debt ceiling by President Obama.
This stalemate caused many participants to stick to the sideline during the session on concern that a deal may wait until the last minute.
The August trade balance report and the Job Openings report were due to be released on Tuesday, but they will be delayed on account of the partial government shutdown which is looking like it will enter its eighth day this morning.
The day ended with all major Indices finished with a loss close to 1%.
We need to keep in mind that until we get through October 17th – the debt limit deadline – market participants will probably keep their time frame shorts and to volatility to pick up as we get closer.
During the session in Asia this morning we see the U.S. dollar inching higher against the Japanese Yen, after disappointing economic data out of Japan. Current account surplus drop down 63.7% on a yearly basis, while the expectation were for the surplus to actually to rise.
the strengthening of the dollar against the yen comes after several days where we saw the yen served as a safe haven alternative for the flowing money in the capital markets. We believe that until Washington reaches an agreement, this flow will continue and any pull back will serve as an entry opportunity in the prevailing trend.
The release from the New Zealand Institute of Economic Research said business confidence rose in the prior quarter reaching 14 years high. This news had no impact on the New Zealand currency, and the pair moved down, showing that investors and traders are moving out of riskier assets till we get some clarity out of the U.S.
on the Commodities front, we see the Oil trading mostly higher even the U.S government shutdown continues.
Gold traded lower as the shiny metal digesting the impressive gain from the previous day. The Gold is likely to find support around $1,277 area.
Good luck trading!
