Currency Playbook - Blue Line FX Rundown
Bill Baruch of Blue Line Futures - - Mon Aug 19, 4:07PM CDT
FX Rundown

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Euro (September)

Fundamentals:The Euro secured its fifth straight losing session after Eurozone CPI was soft and the German Bundesbank warned of a recession in its latest Monthly Report this morning. Although Michigan Consumer data in the U.S missed on Friday, broadly stronger data throughout the week helped fuel the Dollar Index to the highest level since August 1st, the day after the Fed cut. Uncertainties tied to Italy and the ongoing Brexit have also dragged on the Euro of late. Today, Boston Fed President Rosengren who is known to be a hawk advised against additional rate cuts. The debate will heat up in the back half of the week as the Fed releases the Minutes from their July rate-cut meeting Wednesday and the Jackson Hole symposium kicks off Thursday with the keynote speech from Fed Chair Powell Friday.

Technicals:Price action slipped below support at 1.1201 midweek last week and has continued to slide. In fact, Friday was a new front-month settlement low by half a tick and todays was lower. The Euro is now below key support at 1.11265-1.1149 and there does not seem to be much technically in the way between where it is now and a direct test into ...Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and actionable bias and levels.

Yen (September)

Fundamentals:The Yen and safe-haven assets lost ground as the S&P gained more than 1% in this risk-on session. Although the German Bundesbank sent a reminder this morning that Germany could slip into a recession, we at Blue Line believe recession fears centered around the U.S are a bit overzealous. The data last week, CPI, Retail Sales and large regional manufacturing (NY and Philly) was stronger than expected. In fact, we look forward to the smaller August regional manufacturing numbers this week, the likes of Richmond, Kansas City and Dallas. Those three struggled in July. Of course, the Flash PMI data from Europe and the U.S as well. If these turn a corner, the Yen would be in store for a sharp wave of selling. For now, the S&P struggled at strong resistance and the Yen is likely to be a barometer to stocks through tomorrow; weakness in equities will lift the Yen and vice versa.

Technicals:The trend remains strong and major three-star support at ...Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and actionable bias and levels.

Aussie (September)

Fundamentals:The Aussie could not follow the risk-appetite higher today although many credited the move in equity markets to an upbeat U.S and China trade narrative. Regardless, the ongoing trade war has already had an irreversible impact on Australia and the rest of the world for that matter. The U.S Dollars late session strength pressured the Aussie to session lows into the close and ahead of the Minutes from the latest RBA Meeting just two weeks ago.

Technicals:Even on stronger sessions last week, price action could not chew itself out of the basement; a close out above major three-star resistance at ...Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and actionable bias and levels.

Canadian (September)

Fundamentals:Despite a positive vibe surrounding trade (U.S-China and potential completion of the USMCA via comments Vice President Pence) and a banner day for Crude Oil and equity markets, the Canadian finished lower on the session. The U.S Dollar did grind higher up until the end which added pressure and the technical landscape on August 6th, as we noted throughout last week, was broken. If the Canadian cannot rally on good news, this could signal additional pressures upon bad news. Tomorrow, we look to Manufacturing Sales data.

Technicals:The Canadian cannot seem to regain resistance at .7572-.7595 which has led it susceptible to waves of selling. Still, major three-star support at ...Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and actionable bias and levels.

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