Welcome to Asia Monday May 2nd 2016
Hello traders we are ready to start a new week and it looks to be a typical monday. We have CNY and the UK is off for bank holiday today. We have CNY Caixin data release in Asia and then nothing until the US session with only one high impact new release. The Aussie has some data releases in Asia but non market moving data.
Traders it looks like it is going to be a technical trading day until the U.S. session where we can see some data and market mover today.
OK traders let me give you the week in review from last week as a guide for this week and what to look for:
30 Apr 03:42 TradeTheNews.com Weekly Market Update: Spring Cleaning The last groans of the dismal first quarter were heard this week, as economic data and corporate earnings showed just how weak things were in the first three months of the year. Meanwhile, both the Fed and Bank of Japan held policy meetings that delivered zero new measures and very little in the way of color on the institutions' views of the malaise. Stocks sank through the week's end, while the dollar softened notably and oil and precious metals soared. However, the prevailing view in some quarters is one of good riddance to bad rubbish, as the decks are cleared for a nice move higher as the cold spring heats up. A hint of things to come were seen in the much improved European first quarter GDP data. US Treasury prices stabilized helping yields back off of recent 5 week highs, largely on the currents coming from the equity selling pressure. For the week, the DJIA lost 1.3%, the S&P500 dropped 1.3%, and the tech laden Nasdaq slumped 2.7%.Annualized US GDP growth in the first quarter skidded to a two-year low of +0.5%, surprising nobody as Q1 showed seasonal weakness for the third year in a row. Business investment fell sharply, which did surprise many observers. On the positive side, residential investment and personal consumption saw much stronger-than-expected gains. In any case, the weak overall number was widely expected. The mildly more hawkish notes in the FOMC statement seemed to leave the door open for a rate hike at the June meeting, although the preponderance of its very cautious language largely remained in place. The committee removed from the statement a warning about risks from "global economic and financial developments," saying that it was now monitoring such developments. For the third time in a row, Fed officials refrained from providing guidance on the balance of risks. The statement provided a mixed picture of the economy. It emphasized the improving labor market and noting that "strong job gains" likely herald a further pickup but acknowledged that economic growth "appears to have slowed." Fed Funds futures saw the odds of a June hike fall to 12% following the GDP report from around 21% after the end of the Fed policy meeting the day earlier.The yen's big move higher in the last week of March and the first week of April saw USD/JPY break below the key level of 110, inspiring talk that either the government or the Bank of Japan would have to do something to bolster the economy and cool off the currency. Neither side has budged this month, with the BoJ resorting to verbal intervention and the government merely hinting that the sales tax might be hiked slightly less than planned (and only then because of the Kumamoto earthquake). The yen had come off its 18-month highs in the middle of April, thanks mostly to rumors that more BoJ easing could not be avoided, with talk of the bank authorizing more asset purchases or even lending to banks at negative rates. The BoJ authorized neither at Thursday's policy meeting and kept its policy stance unchanged. Markets reacted swiftly: the yen jumped and the Nikkei index slumped. By Friday, USD/JPY was at fresh 18-month lows around 107. There was ominous economic data out this week: March Core CPI fell by 0.3% y/y, the biggest drop since the BoJ launched its easing campaign three years ago. Inaction from both the Fed and the BoJ has reinforced the weaker dollar trend and sent the Dollar Index lower every day this week. By Friday, the index was around 93, the lowest level since last June. Also on Friday, China's PBoC set the yuan at its strongest level since the beginning of April, and the daily fixing moved up by the biggest margin since July 2005. The weaker dolla - Source TradeTheNews.com
OK traders I will keep you updated if there is any kind of moves in the market during this Asia session thanks again and we will talk soon......William
