17 Oct 2013
Session Recap: Risk on amid Washington deal hopes; USD/JPY tests 99.00
FXstreet.com (San Francisco) - Washington, we have a deal. According to the latest developments, Wednesday October 16th will pass into history as the day the first US government shutdown in the new millennium came to an end. Or not, because market welcomed the bipartisan agreement in the Senate while both bodies, the Senate itself and the House must vote it and Barack Obama must sign it yet.
However, the fact that Ted Cruz affirmed he won't block the Senate bill and John Boehner almost accepted his defeat in this battle gave enough hints to the market to believe in the final resolution. The Senate will vote around 8 pm ET and the House around 11 ET. It would give the possibility to Barack Obama to sign the bill in the next days but Shutdown would finish properly on Saturday.
So, with the drama coming to an end, the dollar surged since early American morning on the rumors but it sank along with soaring stocks. Overall, risk traders cheered the solution, selling the dollar and the yen. However, it was in a tempered mood. Stocks rocketed on Wednesday with the DJIA plotting three digits gains and the S&P 500 performing its sixth positive day in the last seven sessions to close at its highest level since September 20th.
On currencies, The EUR/USD closed positive around 1.3230. "Nevertheless, the range prevails with little directional indications at the time being; as long as above 1.3460 level, the bullish bias prevails although further advances beyond 1.36 are required to confirm new highs," commented in a recent report Valeria Bednarik from FXstreet.com.
The GBP/USD closed down on the day at 1.5940 after touching 1.5895 as fresh lowest since September 18th. The Sterling presents a bearish tone against the Dollar in the 4-hour chart. "Renewed selling pressure below this last should lead to a continued slide in the pair, with relief for bulls only with steady gains above 1.6020," affirmed Bednarik.
The USD/JPY jumped to test the 99.00 level but the pair wasn't able to break above this price. Now the pair is closing the day at 98.75 as it oscillates between supports aligned at 98.73 (September 29th highs), 98.34 (September 25th lows) ahead of 97.83 (October 1st highs) and the resistances set at 99.16 (September 27th highs), 99.68 (September 19th highs) followed by 100 (September 6th highs). According to the FXstreet.com trend index, the pair is slightly bullish on one-hour timeframe analysis above the EMA20.
Main headlines in the American session:
Canadian manufacturing sales a bit spongy
US: NAHB Housing Market Index slides to 55 in October
Market exuberance helps lift dollar and equity markets as US set for debt ceiling deal
Senator Cruz says won't delay budget deal: Bloomberg
Bipartisan deal boosts markets, USD
Fed's Beige Book: Some Districts reported slower growth
S&P cut US annualized GDP to 2% in Q4
Wall Street cheers Senate deal and hopes the House will approve it
However, the fact that Ted Cruz affirmed he won't block the Senate bill and John Boehner almost accepted his defeat in this battle gave enough hints to the market to believe in the final resolution. The Senate will vote around 8 pm ET and the House around 11 ET. It would give the possibility to Barack Obama to sign the bill in the next days but Shutdown would finish properly on Saturday.
So, with the drama coming to an end, the dollar surged since early American morning on the rumors but it sank along with soaring stocks. Overall, risk traders cheered the solution, selling the dollar and the yen. However, it was in a tempered mood. Stocks rocketed on Wednesday with the DJIA plotting three digits gains and the S&P 500 performing its sixth positive day in the last seven sessions to close at its highest level since September 20th.
On currencies, The EUR/USD closed positive around 1.3230. "Nevertheless, the range prevails with little directional indications at the time being; as long as above 1.3460 level, the bullish bias prevails although further advances beyond 1.36 are required to confirm new highs," commented in a recent report Valeria Bednarik from FXstreet.com.
The GBP/USD closed down on the day at 1.5940 after touching 1.5895 as fresh lowest since September 18th. The Sterling presents a bearish tone against the Dollar in the 4-hour chart. "Renewed selling pressure below this last should lead to a continued slide in the pair, with relief for bulls only with steady gains above 1.6020," affirmed Bednarik.
The USD/JPY jumped to test the 99.00 level but the pair wasn't able to break above this price. Now the pair is closing the day at 98.75 as it oscillates between supports aligned at 98.73 (September 29th highs), 98.34 (September 25th lows) ahead of 97.83 (October 1st highs) and the resistances set at 99.16 (September 27th highs), 99.68 (September 19th highs) followed by 100 (September 6th highs). According to the FXstreet.com trend index, the pair is slightly bullish on one-hour timeframe analysis above the EMA20.
Main headlines in the American session:
Canadian manufacturing sales a bit spongy
US: NAHB Housing Market Index slides to 55 in October
Market exuberance helps lift dollar and equity markets as US set for debt ceiling deal
Senator Cruz says won't delay budget deal: Bloomberg
Bipartisan deal boosts markets, USD
Fed's Beige Book: Some Districts reported slower growth
S&P cut US annualized GDP to 2% in Q4
Wall Street cheers Senate deal and hopes the House will approve it