Futures Commentary and Analysis

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CPI in the crosshairs
Bill Baruch - IF - Tue Feb 13, 5:46PM CST
FX Rundown

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Euro (March)

Session close:Settled at 1.23805, up 72 ticks

Fundamentals:The Euro has been on a path higher since yesterday morning and we believe much of this is technical. Where the Dollar was vastly oversold, the Euro was overbought, and the trade was due to come back in. With tomorrows U.S CPI in mind, we are now seeing traders reposition with whats been working; short Dollar and long Euro. Additionally, we talked about a bullish inverted head and shoulders pattern on the 30 min / hourly last night. The week is just starting to cook, and tomorrow morning will be a big one. German CPI and GDP data is due at 1:00 am CT. German Bundesbank President Weidmann speaks at 2:00. Eurozone GDP and Industrial Production are at 4:00 am CT. ECBs Mersch speaks at 4:20. There is a German 30-year Bund auction at 4:40. U.S CPI and Retail Sales are due at 7:30 am CT and Business Inventories is at 9:00.

Technicals:Yesterday we turned outright Bullish and noted the strong close creating an inverted head and shoulders pattern.Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

Yen (March)

Session close:Settled at .93035, up 83 ticks

Fundamentals:The Yen put in a very strong session ahead of GDP data due at 5:50 pm CT tonight. This morning on the Morning Express, we discussed the Nikkei trading 12% from its high. Ultimately, equity market volatility has helped support the Yen. This goes two ways, because a higher Yen is also weighing on Japanese equities. Adding uncertainty to the stew, Bank of Japan Governor Kuroda is expected to be reappointed, but we have yet to see this officially come from Prime Minister Abe. Kuroda is the architect of ultra-loose monetary policy and if there is any question behind him returning or if a delay in his appointment eludes to a shift in policy, the Yen has much higher to go.

Technicals:This breakout above major three-star resistance ultimately creates a path of least resistance to our next major three-star level.Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

Aussie (March)

Session close:Settled at .7856, up 16 ticks

Fundamentals:The Aussie grinded out a positive session on U.S Dollar weakness. Still, as a commodity currency, it has not performed as well as the Euro or the Yen as the risk-on trade is taking a breather. NAB Business Confidence came in better than expected last night. Tonight, we look to Westpac Consumer Sentiment due at 5:30 pm CT. Tomorrow evening is Employment data but until then tomorrows U.S CPI and Retail Sales will be key for this trade.

Technicals:Price action traded to a high of .7876 today before backing off slightly.Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

Canadian (March)

Session close:Settled at .79445, up 14 ticks

Fundamentals:The Canadian has held well given its recent fundamental hurdles due to job losses and a weak energy complex. The U.S Dollar lent strength today, but with no domestic data, the trade will be entirely dependent on U.S data. Traders should also keep an eye on Crude, it is at an inflection point of sorts and a sharp move of 2% or more in either direction tomorrow will drag the Canadian with it.

Technicals:Price action continues to act favorably off Fridays reversal low.Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

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Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.

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