{"id":154836,"date":"2019-09-05T11:55:53","date_gmt":"2019-09-05T15:55:53","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=154836"},"modified":"2019-09-05T11:38:14","modified_gmt":"2019-09-05T15:38:14","slug":"risk-on-flows-continue-driving-markets","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/09\/risk-on-flows-continue-driving-markets\/","title":{"rendered":"Risk-On Flows Continue Driving Markets"},"content":{"rendered":"
September 5, 2019<\/div>
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By <\/strong>Orbex<\/strong><\/a><\/p>\n

An array of positive political developments yesterday and overnight have\u00a0sparked some risk-on flows that seem to be carried over<\/strong>\u00a0to today\u2019s session. All FX majors, including EURUSD, GBPUSD, AUDUSD, NZDUSD, and USDCAD have been affected by positive events.<\/p>\n

Euro Trouble-Free Above 1.10, But Stuck Near 10 SMA<\/strong><\/h2>\n

The European currency\u00a0remains bid<\/strong>\u00a0against the US counterpart. Currently above the psychological handle of 1.10, trading near a fresh weekly high. With the Italian coalition forming a new government, it is unlikely that EURUSD is going to fall below the said level, even after the NY open. Unless NY markets take the positive US\/China trade-talk developments to heart.<\/p>\n

Yesterday, Lagarde\u2019s message for a longlasting accommodative policy didn\u2019t seem to bother euro bulls much. This suggests a stronger eurodollar. That will, of course, also depend on fundamentals.\u00a0Investors are eying the ADP and ISM NMI<\/strong>\u00a0releases later today. Whether the 10 SMA on the daily weakens or not will impact also.<\/p>\n

Cable Pierces Through 1.22, Investor Eye 1.23<\/strong><\/h2>\n

Without a win on the no-deal Brexit vote<\/a>, Boris Johnson\u2019s\u00a0strategy to leave the EU by October 31st failed.\u00a0<\/strong>This\u00a0is \u201cgood news\u201d for the pound. BoJo\u2019s attempt to lock parliamentarians out with a Queen\u2019s Speech finally backfired. This allowed market participants to take a breather and \u2018long\u2019 cable.<\/p>\n

GBPUSD is currently trading near the psychological 1.2270 level. Without any UK-based data, the pound\u00a0is likely to remain strong<\/strong>. Otherwise, a pullback can be seen in the short-term in the form of a rejection.<\/p>

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Commodity Assets Up On Carrie Lam\u2019s Move<\/strong><\/h2>\n

Aussie, kiwi and perhaps the loonie also keep moving higher this morning on the back of Carrie Lam\u2019s move to withdraw the somewhat catastrophic extradition bill. With\u00a0risk improving and the dollar falling,<\/strong>AUDUSD crossed above the 68 cent barrier. Furthermore, NZDUSD is also nearing 64 cents, and USDCAD only just received a rejection at the 1.32 mark.<\/p>\n

The Canadian dollar is also supported by a rather\u00a0dauntless BoC and a bid crude oil owed to yesterday\u2019s API<\/strong>\u00a0report. API reported a small build of 400k compared to 3.5 million barrels expected. This result drove oil nearly $3 higher. BoC on the other hand, held rates unchanged yesterday, citing\u00a0strong economic growth and a clear path to hit their inflation target.<\/strong><\/p>\n

Equities Soar Again on Risk, Yen and Gold Down<\/strong><\/h2>\n

With the market\u2019s appetite shifting, SPX reversed course once again to the upside. However, in the medium-term, the picture is still unclear. Prices are reaching a\u00a0strong psychological level at 3000<\/strong>.<\/p>\n

USDJPY, USDCHF, and Gold are currently taking a beating<\/strong>\u00a0as capital inflows on riskier assets outweigh the safe-haven demand in large blocks. The Swiss also reported somewhat\u00a0stagnant GDP figures<\/strong>\u00a0earlier in the morning\u00a0(0.3% as expected but lower than 0.4% last)<\/a>, so the weakness could be partially attributed to that set of economic data too.<\/p>\n

By <\/strong>Orbex<\/strong><\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

By Orbex An array of positive political developments yesterday and overnight have\u00a0sparked some risk-on flows that seem to be carried over\u00a0to today\u2019s session. All FX majors, including EURUSD, GBPUSD, AUDUSD, NZDUSD, and USDCAD have been affected by positive events. Euro Trouble-Free Above 1.10, But Stuck Near 10 SMA The European currency\u00a0remains bid\u00a0against the US counterpart. […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-154836","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/154836","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=154836"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/154836\/revisions"}],"predecessor-version":[{"id":154839,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/154836\/revisions\/154839"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=154836"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=154836"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=154836"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}