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FOREX: EUR Sinks as German Regions Point to Disappointing National Print

FOREX
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  • The single currency is softer early Thursday as regional German CPIs followed Spanish inflation data in disappointing to the downside, suggesting the national German inflation print later today will come in below forecast. EUR/USD trades below $1.11 as a result, and EURGBP has also fallen 0.3% on the day. A negative close in the cross today would extend the losing streak to seven sessions, with the cross revisiting the lows seen across July below the 0.8400 mark. The extension down reinforces the bearish significance of the recent break of the 50-day EMA. Furthermore, the cross has cleared all key retracement points of the rally between Jul 17 - Aug 8.
  • CHF similarly trades poorly, partially unwinding a small part of the recent strength and allowing for a bounce off the multi-month low printed in USD/CHF earlier this week. Speculation around SNB involvement and persistent bullish options positioning in the CHF has helped trigger and oversold condition in USD/CHF in recent weeks, which is modestly reversing into the Thursday NY crossover.
  • NZD trades well, dragging AUD with it, and helping NZD/USD press 0.63. A clearance above the handle would be the first since January - with the more solid commodities backdrop (iron ore, gold and silver higher) and bounce off lows for equities adding to the theme.
  • A raft of US data crosses later today,  with the secondary reading of Q2 US GDP due alongside initial jobless claims data for the latest week, and July retail inventories. Pending home sales are set to follow. ECB's Lane and Nagel are set to speak as well as another appearance from Fed's Bostic, who spoke late yesterday.
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  • The single currency is softer early Thursday as regional German CPIs followed Spanish inflation data in disappointing to the downside, suggesting the national German inflation print later today will come in below forecast. EUR/USD trades below $1.11 as a result, and EURGBP has also fallen 0.3% on the day. A negative close in the cross today would extend the losing streak to seven sessions, with the cross revisiting the lows seen across July below the 0.8400 mark. The extension down reinforces the bearish significance of the recent break of the 50-day EMA. Furthermore, the cross has cleared all key retracement points of the rally between Jul 17 - Aug 8.
  • CHF similarly trades poorly, partially unwinding a small part of the recent strength and allowing for a bounce off the multi-month low printed in USD/CHF earlier this week. Speculation around SNB involvement and persistent bullish options positioning in the CHF has helped trigger and oversold condition in USD/CHF in recent weeks, which is modestly reversing into the Thursday NY crossover.
  • NZD trades well, dragging AUD with it, and helping NZD/USD press 0.63. A clearance above the handle would be the first since January - with the more solid commodities backdrop (iron ore, gold and silver higher) and bounce off lows for equities adding to the theme.
  • A raft of US data crosses later today,  with the secondary reading of Q2 US GDP due alongside initial jobless claims data for the latest week, and July retail inventories. Pending home sales are set to follow. ECB's Lane and Nagel are set to speak as well as another appearance from Fed's Bostic, who spoke late yesterday.