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Trade hopes boost Stock indexes, risk currencies take a breather

jeffriess
January 3, 2020
by Joseph Jeffriess, Market Analyst

Article Recap

US Indexes hit new records - USD and JPY fightback to risk majors - Gold hits new weekly highs ignoring the USD and rallying stocks - Saturday morning news to come

Trade deal hopes and tariff reductions lift stock indexes, USD and JPY fightback….

US indexes hit new records overnight the Dow adding 1.16%, the Nasdaq soaring 1.33% higher. Shares in Europe lifted the DAX and CAC adding just over 1%. Trade deal hopes and a rollback in proposed tariffs helped boost buying. Unemployment falling in 2019 also helped the DAX as traders continue to look for green shoots in the German economy.

FX had an interesting night, with no key USD data and good news on the trade front lifting risk assets, you’d think it risk currencies would have positive drivers. This wasn’t the case late into the Lon session and through the NY session as the main risk majors fell to the USD and JPY. The GBP and EUR saw the main losses. The EUR lost 0.32% to the USD and 0.46% to the Yen, while the GBP fell 0.78% to the Dollar and 1.01% to the JPY. The USD was far from strong across the boards as it struggled to make any real gains on the CAD and fell to the 0.14% JPY, at one stage moving below Novembers low.

The ASX200 has continued it’s fightback adding 1.23% to this stage in the session. The AUD remains weaker to the USD while the EUR is falt and the GBP holds small gains. Gold hit new weekly highs overnight ignoring the USD and stronger stocks. At this point, Gold buyers are holding an eighty cent gain.

Today’s video, we go over last night’s action and look forward to tomorrow mornings key USD data and news, we have ISM manufacturing PMI data at 2:00 am and FOMC meeting minutes at 6:00 am. We take a detailed look at the current USDJPY daily chart, focusing on the current main support point that once again held overnight after knocking back a new breach from sellers.

Good trading from Eightcap.
All times are AEDT.