The yen is falling and the Dollar is regaining its strength awaiting the Non-Farm Payrolls report today

Asian stocks opened higher on the talks that the U.S. and North Korea Leaders will be meeting the first time since Bill Clinton visited the hermit kingdom in 2009 which led to the pardon of two U.S. journalists imprisoned in the country.

The yen is falling and the Dollar is regaining its strength awaiting the Non-Farm Payrolls report today

The Yen is falling

Asian stocks opened higher on the talks that the U.S. and North Korea Leaders will be meeting the first time since Bill Clinton visited the hermit kingdom in 2009 which led to the pardon of two U.S. journalists imprisoned in the country.

The Kopsi rose as much as 1.8%, while the USDJPY rose as much as 0.7% and the Nikkei jumped 2.4% before the afternoon selloff briefly wiped out all the gains. The Bloomberg dollar index strengthened for a second day after the exemptions of Canada and Mexico from the trade tariffs imposed on Steel (25%) and Aluminum (10%) imports by the U.S.

Treasuries were modestly softer with the 10-year yield-up 1 basis point. Aussie 10-year were 2 basis points lower as the Chinese bond futures dipped on the highest CPI reading since 2013.

WTI crude was near $60.30, as Dalian iron falls 2.8% its third day of losses.

The Key Headlines of the Asian Session:

  • Trump agrees to meet North Korea’s Kim Jong Un
  • Fed’s George says risks appear to be predominate to the upside.
  • No Brexit deal until next year, U.K. officials say privately.
  • China February CPI at 2.9% y/y vs the 2.5% estimated as PPI was at 3.7% y/y vs a 3.8% estimated.
  • PBOC Governor Zhou says China may reduce reliance on money supply to boost growth.
  • BOJ keeps policy unchanged as expected with the statement on CPI unchanged.
  • BOC member Lane: Bank of Canada not on a preset path to higher rates, with every decision, is a live one.

 

OUTLOOK

The European market takes over the Asian Session as investors were busy digesting the fact that tariffs have been imposed on Steel and Aluminum and waiting for the U.S. session when Non-Farm Employment Change will be released. However, before that comes into play, the U.K. will be releasing their Manufacturing Production figure which is expected to rise by 0.2% vs the 0.3% of the previous month. Goods trade balance is also on the table for data releases which is expected to rise by 1 billion pounds from -13.6 Billion to -12.0 Billion.

TRADERS VIEW

The Yen and Treasuries were sold as the U.S. President, Donald Trump, agreed to meet with North Korean leader Kim Jong Un drives risk-on sentiment. Dollar-yen then pares gains as it encounters resistance near 107.00 from option investors who are defending positions related to Friday expiration of notional $4.1b at that strike. Bank of Japan lefts its monetary policy unchanged as expected. Its statement dropped a reference to Europe’s debt crisis.

USDJPY – The pair is consolidating in the near-term above the 105.00 handle as resistance is seen at the March 1sthigh of 107.20 with support seen on March 2 low of 105.25.

EURUSD – The pair is consolidating between the Feb highs of 1.2522 and the March lows of 1.2155.

EURUSD 

EURJPY – The Yuppy is hovering around the 200-DMA with resistance seen at 131.53. Support, on the other hand, is seen at the March 8 low od 130.52.

 

USDZAR –  Before the GDP growth rate was announced, the rand had been steady in early trade, Markets indeed took this in their collective stride, and we saw the Rand rallying back from the R12.00 level to close the day in the low R11.80's

USDZAR

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***Information contained in this newsletter are gathered from third parties and should not be regarded in any way as trade advice or recommendations by CM Trading. CM Trading does not recommend or advise traders or investors in their decision making but merely provides information from the market for its clients as additional information is made available as per the events occurring in the financial markets.

 

HIGH RISK WARNING:

Trading Foreign Exchange (Forex) and Contracts for Differences (CFD’s) is highly speculative, carries a high level of risk and may not be suitable for all investors. You may sustain a loss of some or all of your invested capital, therefore, you should not speculate with capital that you cannot afford to lose. You should be aware of all the risks associated with trading on margin.

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