The Trade Setting Post Draghi’s Speech and Ahead of Fed Data

In case you were wondering what the trade setting would look like after Mario Draghi’s speech today and ahead of Federal Reserve data, here is what to have in mind:

1. The USD stays supported against a basket of other major currencies, as investors are looking forward to Fed policymakers’ commentaries on monetary policy. In anticipation of any resolution, the EURUSD pair experienced little changes as Draghi spoke about structural reforms. The pair seems to be resuming its 1.7626 band after hitting 1.1729 earlier in the session.

2. American Express (NYSE: AXP), eBay (NASDAQ: EBAY), United Continental (NSE: UAL) and Alcoa (NYSE: AA) release their earnings report along with other big companies like US Bancorp (NYSE: USB) and Abbot Labs (NYSE: ABT). While the 3rd quarter earnings season is only just beginning, 82% of the 45 S&P companies releasing their earnings reports so far have beaten the market consensus, while 73% exceeded estimates on sales, The Earnings Scout experts suggest.

3. All eyes on futures! US futures continue to gain momentum, with the Dow heading towards the 23,000 level. S&P 500 hit record highs today, gaining 3 points, or 0.11%, while Nasdaq 100 futures moved up another 5 points, or 0.88%.

European stocks gained pace too, although the Spanish equities hit the red line, as the country awaits Catalonian President Carles Puigedemont’s resolution as to whether Catalonia has officially declared its independence.

Asian equities are also following an ascending trend, as Chinse President Xi Jimping pesented his plan to support the world’s second most powerful economy. Both Japanese Nikkei and Chinese Shanghai Composite closed 0.2% higher.

4. USDCAD stays in the neutral area, with the loonie returning to its mid-point position, impressively recovering from Tuesday’s low, backed up by an extension of NAFTA negotiations (March 2018 from December), according to Scotiabank’s FX Strategist Eric Theoret. On a more technical outlook on the pair, while  ‘trend and momentum indicators are modestly bullish,’ he noted, USDCAD remains range-bound, with an expected support anywhere between 1.2480 and 1.2450 and resistance above the 1.2550 level.

5. USDJPY traded higher today through early NA session and sits currently only a few pips away from the 113.00 area.