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Dollar analysis: EUR/USD, GBP/USD and Yields in focus – Forex Friday
Welcome to another edition of Forex Friday, a weekly report in which we highlight selected currency themes. In this week’s report, we will focus the US dollar, EUR/USD and GBP/USD. The dollar index eyes March high and set to close higher for 10th consecutive week, with BoJ inaction and rising crude oil prices providing additional boost for greenback.
How to trade low volatility: strategies for quiet markets
We talk a lot about how volatility creates opportunities for traders. But what happens when there’s only a little market movement to take advantage of? Find out what to trade when there’s low volatility and what the best low volatility trading strategies are.
USD/JPY falters around 148 ahead of CPI and BOJ: Asian Open 22/09/2023
The US dollar handed back its post-FOMC gains despite surging bond yields, which saw USD/JPY form a 2-bar reversal day after a false break of 148. And this leaves the potential for a deeper pullback towards its 20-day EMA before its trend resumes (keep in mind Japan's CPI report and BOJ interest rate decision is in focus today).
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Volatility trading guide: its causes and the most volatile markets
Markets are always on the move, but the speed and size of price changes is what creates excitement (and risk) for traders. So, let’s take a look at how to trade volatility, and which markets experience the highest levels of volatility.
Euro analysis: EUR/USD Bulls Defend Support in the Mid-1.06s
If we see a daily close below 1.0635 support, it would open the door for another leg lower in EUR/USD...
GBP/USD analysis: BoE decides against another interest rate hike
Earlier, the Bank of England announced interest rates would be kept unchanged in a surprise move (not to us) and the pound took another plunge, dropping below 1.2250 in initial reaction. The BoE’s policy statement was somewhat hawkish and the MPC split. This means that the next few policy decisions could be close calls, especially if inflation doesn’t come down fast enough.
AUD/USD, ASX 200 headwinds to persist with ‘higher for longer’ Fed rates: Asian Open
At the most basic level the Fed delivered what was expected; another policy pause with the potential for further hikes. The opening paragraph tipped noted an economy which is “expanding at a solid pace” with a slower but “strong” job growth and elevated inflation. There’s nothing remotely dovish there. And then we look at the numbers…
Euro to dollar analysis: EUR/USD short term levels to watch for FOMC
The EUR/USD and other dollar pairs will be in sharp focus for FX traders as the attention turns to the upcoming Fed decision in a few hours’ time. No rate hike is expected, but the market is pricing in about even odds of another rate increase before the year is out.
GBP/USD outlook: Inflation and central bank meetings take center stage – BoE Preview
The GBP/USD will come into sharp focus over the next couple days, with two pivotal events on the horizon: the FOMC and BoE rate decisions. Additionally, traders are anticipating the release of UK CPI and retail sales data, as well as global PMI figures this week. These developments collectively have the potential to shape the near-term GBP/USD outlook. UK CPI could sway BoE decision, with the UK central bank likely to mimic ECB's dovish hike. Meanwhile, the FOMC is likely to go for a hawkish hold.
Dollar analysis: EUR/USD, DXY and Gold in focus - Technical Tuesday
Welcome to Technical Tuesday, a weekly report where we highlight some of the most interesting markets that will hopefully appease technical analysts and traders alike. In this edition of Technical Tuesday, we will analyse the EUR/USD, Gold and the Dollar Index.
USD/CAD in the crossfire of CA CPI and FOMC: European open – 19/09/2023
The Canadian dollar has continued to strengthen alongside oil prices in recent days, sending USD/CAD to a near 5-week low, GBP/CAD beneath its 200-day EMA and CAD/JPY to within striking distance of its 2022 high. Today’s Canadian inflation data could prove volatile for USD/CAD ahead of tomorrow’s FOMC meeting.
EUR/USD suffers its worst weekly run in 26 years ahead of FOMC
EUR/USD fell for 9th week by Friday's close, its worst weekly run since 1997. Yet whilst that could mean it is 'owed' a bounce, history suggests such bearish runs are later accompanied by further losses, as macro themes can trump technicals during such times. And that places this week's FOMC meeting into focus, where we discuss the likelihood that it might be more dovish than markets currently are pricing in.
Oil, Canadian Dollar Analysis: USD/CAD Hits 1-Month Lows as Oil Rally Extends
Technical analysis shows WTI may be getting stretched while USD/CAD could have further to fall...
GBP/USD Outlook: BoE and FOMC meetings make Cable Currency Pair of the Week
The GBP/USD is in focus ahead of this week’s key events: FOMC and BoE rate decisions. We also have UK CPI and retail sales, as well as global PMI figures to look forward to this week. The BoE is likely to deliver a final 25 bps hike, while FOMC is seen holding policy unchanged. The GBP/USD could be heading to low 1.20s in this busy week.
US dollar, USD/CAD, WTI crude oil analysis: Commitment of traders report (COT)
The USD is on the cusp of flipping to net-long exposure among G10 currencies according to data compiled by IMM (International Monetary Market). And despite the resurgence of US dollar strength, oil continues to perform well and market positioning is looking increasingly bullish for the weeks or even months ahead.
Gold rallied from its 200-day EMA on Friday: Asian Open – 18/09/2023
Gold prices enjoyed their best day in 13 on Friday and rallied from the 200-day EMA, after finding support above 1900 on Thursday. Yet key resistance levels loom overhead meaning we'd prefer to see a pullback before reconsidering longs ahead of key events this week including the FOMC meeting.
Dollar Analysis: EUR/USD, GBP/USD and DXY in focus - Forex Friday
Welcome to another edition of Forex Friday, a weekly report in which we highlight selected currency themes. In this week’s report, we will focus the US dollar, EUR/USD and GBP/USD ahead of next week’s key events: FOMC and BoE rate decisions.
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EUR/USD headed for 105? WTI crude oil hits YTD high: Asian Open
The ECB delivered a relatively dovish hike whilst US data once again outperformed. And that was the perfect catalyst to send EUR/USD to a 4-low (and speculative positioning suggests there may be further downside to come). WTI crude oil rose above $90, and it appears to have more fuel in the tank to perhaps head for the October high.
EUR/USD outlook: ECB in dovish hike ahead of more central bank action next week
Prior to today’s ECB meeting, there was a bit of uncertainty whether the ECB would hike or not, with markets pricing in a 65% implied probability of a 25-bps hike. In the end, it went ahead with the rate hike, lifting the main refinancing rate to 4.50% from 4.25% previously. But the euro nonetheless fell sharply. This is because the ECB strongly indicated that we have reached a terminal interest rate...
EUR/USD implied volatility blows out ahead of ECB, US data: European open
With an ECB interest rate decision and three US data points sandwiched in between, we could be in for an interest hour's trade on EUR/USD. And that likely explains why the 1-day implied volatility band is more than twice its 20-day average.
AUD/USD holds 64c, bonds retrace post CPI, jobs up next: Asian Open
US CPI was higher than expected, although bond yields pulled back in what could be a sign that investors are more concerned over a recession compare with a 'soft landing' for the US. But if yields continue to pull back it might take some steam out of the dollar rally. And that could help AUD/USD, which has remained reliant to breaks below 64c.
Pound analysis: GBP/JPY and GBP/USD in focus
Today’s latest data once again highlighted the growing threat of stagflation in Europe, with UK economic output and eurozone industrial production both falling more than expected. High levels of inflation and low growth, combined with downbeat business and consumer sentiment, and not to mention rising borrowing costs, all make for a tough economic climate for investors to navigate through.
USD/JPY rises into US CPI, GBP/AUD holds key support: European open
USD/JPY was rising on the back of USD strength earlier in the Asian session, with USD/JPY seemingly trying to close its large weekend opening gap ahead of US CPI data. GBP/AUD has also caught our eye as its 3-wave retracement is trying to form a base around a support cluster.