After a strong week of trading towards highs the EUR and GBP have paused it appears as of this morning in order to consolidate against the USD. It is not that the currencies are alive, but the psychology of the market remains cautious via its interpretation of USD value. With weaker than expected jobless numbers on Tuesday via the delayed reporting of the Non-Farm Employment Change numbers all signs continue to point towards a Federal Reserve that will stick with its current monetary policy. While equity markets have traded higher for the most part globally this week, they also appear to be seeking rather tentative terrain so far today.
Germany continued to disappoint with its economic data early this morning with a lackluster Ifo Business Climate reading, this on top of the negative marks from the Flash Manufacturing and Services sectors via PMI reports yesterday. And while the U.K. met expectations with its GDP statistics today, the result of 0.8% growth is not going to start a parade. And Thursday’s poor CBI Industrial Order Expectations outcome from Britain will not help matters. Recent data from both Europe and the U.K. have not been inspiring and may begin to hamper sentiment that has tried to shine a happier light.
Thus after trading lower against the Single Currency and Sterling for the better part of the a week, the Greenback may have room in order to test its stronger short-term ranges today. In the meantime, the AUD has also traded slightly lower against the USD. The JPY however has gained this morning.
Gold continues to test higher resistance and as of this morning the precious metal is near 1342.00. This as Crude Oil has slipped further and now finds itself near support levels. Grains turned in a positive day of gains on Thursday putting in mostly gains, while Cotton dropped slightly. The commodities markets as often the case remain the playground of speculative traders and institutional forces.
The States will be releasing Core Durable Goods Orders data today and a Revised Consumer Sentiment publication will come from the University of Michigan.
On a whole the broad markets have stayed rather comfortable for those seeking opportunities with range trading techniques. Next week will grow more interesting and possibly more volatile as quarterly earnings begin to make a bigger mark on Wall Street and important economic data comes forth such as the U.S. Retail Sales numbers – this as investors take another look into the heart of the American consumer.