4 May 2015
China PMI drags Asia, EZ Final PMIs, US Factory Orders – Next Up
FXStreet (Mumbai) - The Antipodeans set off to softer start to the week following downbeat Chinese PMI numbers, with the Aussie shrugging off a set of better than expected Australian macro data. USD/JPY was wavering above 120 handle, easing-off fresh two-week highs reached at 120.30 on Friday.
Key headlines in Asia
China's Manufacturing PMI deteriorates in April
Australia building permits upbeat in March
Key events ahead – Westpac
Dominating themes in Asia - centered on JPY, AUD, NZD
Thin-trading in Asia with Japan closed in n observance of Greenery Day while Asian markets mostly lower, dragged down by poor Chinese factory data. While the US dollar remained muted, consolidating gains seen on Friday following the recent mixed US macro data.
Both the Antipodeans remained in red after Chinese manufacturing index hit a one year low in April as domestic demand diminished, which raised fresh concerns over the country’s external demand and expectations of further easing form the world’s second largest consumer. AUD/USD was also dragged lower ahead of Tuesday’s RBA policy decision while the Kiwi followed suit as markets remained cautious ahead of a busy NZD calendar this week.
USD/JPY tests 120 barrier and consolidates in a narrow range as markets sought to lock-in gains after the recent strength supported by upbeat US consumer sentiment and employment figures last week.
Heading into Europe - centered on EUR, GBP
Limited data on cards during the European session with Euro zone final PMI readings to dominate while UK remains closed in observance of May Day.
The euro zone preliminary manufacturing PMI in April came in at 51.9 and the same result is expected in the final reading. The services sector reported 53.7 last time, with the same number expected as a final result again.
The flash PMI for Germany's manufacturing sector activity recorded 51.9, with the indicator expected to hold in the final result.
Later, we have a data-light North American session with US factory orders to be published at 1400GMT followed by FOMC member Evans speech at the Columbus Economic Development Board's Annual Meeting.
Further insights on EUR, GBP trades - Chris Capre, Founder at 2ndSkies notes, "The key support zone for the (GBP/USD) pair ST comes in at 1.5115 - 1.5065. A break below this zone opens an attack on 1.4863 so lots of potential downside remains. Unless that large bar at the end of the move was exhaustion price action selling, then I'm suspecting another leg down after a small pullback. Only a strong impulsive bounce here changes my ST bearish bias."
While Goldman Sachs FX Analysis Team believes, "EURUSD has gone past 1.10-1.1050 resistance, which held the top of the March/April triangle formation. It is now clear that the analogy of a triangle wave 4 is no longer valid. The possibility that it’s already completed 5waves from the May high is something to seriously consider. If this is true, it should already have started a corrective process which, as often discussed, translates to a period of messy/counter-trend price action."
Key headlines in Asia
China's Manufacturing PMI deteriorates in April
Australia building permits upbeat in March
Key events ahead – Westpac
Dominating themes in Asia - centered on JPY, AUD, NZD
Thin-trading in Asia with Japan closed in n observance of Greenery Day while Asian markets mostly lower, dragged down by poor Chinese factory data. While the US dollar remained muted, consolidating gains seen on Friday following the recent mixed US macro data.
Both the Antipodeans remained in red after Chinese manufacturing index hit a one year low in April as domestic demand diminished, which raised fresh concerns over the country’s external demand and expectations of further easing form the world’s second largest consumer. AUD/USD was also dragged lower ahead of Tuesday’s RBA policy decision while the Kiwi followed suit as markets remained cautious ahead of a busy NZD calendar this week.
USD/JPY tests 120 barrier and consolidates in a narrow range as markets sought to lock-in gains after the recent strength supported by upbeat US consumer sentiment and employment figures last week.
Heading into Europe - centered on EUR, GBP
Limited data on cards during the European session with Euro zone final PMI readings to dominate while UK remains closed in observance of May Day.
The euro zone preliminary manufacturing PMI in April came in at 51.9 and the same result is expected in the final reading. The services sector reported 53.7 last time, with the same number expected as a final result again.
The flash PMI for Germany's manufacturing sector activity recorded 51.9, with the indicator expected to hold in the final result.
Later, we have a data-light North American session with US factory orders to be published at 1400GMT followed by FOMC member Evans speech at the Columbus Economic Development Board's Annual Meeting.
Further insights on EUR, GBP trades - Chris Capre, Founder at 2ndSkies notes, "The key support zone for the (GBP/USD) pair ST comes in at 1.5115 - 1.5065. A break below this zone opens an attack on 1.4863 so lots of potential downside remains. Unless that large bar at the end of the move was exhaustion price action selling, then I'm suspecting another leg down after a small pullback. Only a strong impulsive bounce here changes my ST bearish bias."
While Goldman Sachs FX Analysis Team believes, "EURUSD has gone past 1.10-1.1050 resistance, which held the top of the March/April triangle formation. It is now clear that the analogy of a triangle wave 4 is no longer valid. The possibility that it’s already completed 5waves from the May high is something to seriously consider. If this is true, it should already have started a corrective process which, as often discussed, translates to a period of messy/counter-trend price action."