Dollar Might Take a Breather after Steep Selloff, Swiss Franc Taking the Top Spot
| Action Insight Daily Report 7-13-23 |
Dollar Might Take a Breather after Steep Selloff, Swiss Franc Taking the Top Spot |
Following a significant post-CPI sell-off, Dollar's plunge appears to be losing some momentum during today's Asian trading session on oversold conditions. However, the greenback is yet to demonstrate any considerable signs of a rebound. Investors seem buoyed by the waning likelihood of Fed extending its tightening phase beyond the imminent July interest rate hike. As it stands, Fed fund futures are reflecting less than 30% chance for further rate hikes throughout the remainder of the year. In sync with this development, major Asian stock indexes are showing considerable gains, riding on the coattails of US market rally overnight. New Zealand and Australian Dollar are the stronger ones for today. followed by Swiss Franc. Meanwhile, Dollar, Yen and Canadian are the worst. But for the week, Swiss Franc is the top gainer at this point, helped by EUR/CHF breaking through a key near term support level. Yen is still strong as the second, but got its first place taken by the Franc. Canadian Dollar is the second worst following Dollar despite yesterday's BoC rate hike. Euro is having a slight advantage over Sterling while Aussie and Kiwi are mixed. Technically, EUR/CHF's dive through 0.9670 support confirms resumption of whole decline from 1.0095. The structure of the fall still suggests that it's a corrective move. But deeper decline would remain in favor as long as 0.9721 support turned resistance holds. Next target is 100% projection of 0.9995 to 0.9670 from 0.9840 at 0.9515. If realized, the extended fall in EUR/CHF would make USD/CHF short a better trade than EUR/USD long. In Asia, at the time of writing, Nikkei is up 1.40%. Hong Kong HSI is up 2.32%. China Shanghai SSE is up 0.99%. Singapore Strait Times is up 1.75%. Japan 10-year JGB yield is down -0.0080 at 0.472. Overnight, DOW rose 0.25%. S&P 500 rose 0.74%. NASDAQ rose 1.15%. 10-year yield dropped -0.119 to 3.861. |
USD/CHF Daily Outlook Daily Pivots: (S1) 0.8623; (P) 0.8713; (R1) 0.8765; More... USD/CHF hits as low as 0.8650 so far today and intraday bias stays on the downside. Current fall should target 100% projection of 0.9439 to 0.8818 from 0.9146 at 0.8525 next. On the upside, above 0.8762 minor resistance will turn intraday bias neutral and bring consolidations first. But outlook will remain bearish as long as 0.8900 support turned resistance holds. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 22:30 | NZD | Business NZ PMI Jun | 47.5 | 48.9 | 48.7 | | 23:01 | GBP | RICS Housing Price Balance Jun | -46% | -30% | | 01:00 | AUD | Consumer Inflation Expectations Jul | 5.20% | 5.20% | | 03:00 | CNY | Trade Balance (USD) Jun | 70.6B | 74.0B | 65.8B | | 06:00 | GBP | GDP M/M May | -0.30% | 0.20% | | 06:00 | GBP | Industrial Production M/M May | -0.40% | -0.30% | | 06:00 | GBP | Industrial Production Y/Y May | -2.30% | -1.90% | | 06:00 | GBP | Manufacturing Production M/M May | -0.50% | -0.30% | | 06:00 | GBP | Manufacturing Production Y/Y May | -1.70% | -0.90% | | 06:00 | GBP | Goods Trade Balance (GBP) May | -14.6B | -15.0B | | 09:00 | EUR | Eurozone Industrial Production M/M May | 0.30% | 1.00% | | 11:30 | EUR | ECB Monetary Policy Meeting Accounts | | 12:30 | USD | PPI M/M Jun | 0.20% | -0.30% | | 12:30 | USD | PPI Y/Y Jun | 0.40% | 1.10% | | 12:30 | USD | PPI Core M/M Jun | 0.20% | 0.20% | | 12:30 | USD | PPI Core Y/Y Jun | 2.60% | 2.80% | | 12:30 | USD | Initial Jobless Claims (Jul 7) | 250K | 248K | | 14:30 | USD | Natural Gas Storage | 49B | 72B |
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