CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

CNH takes the FX spotlight

Article By: ,  Financial Analyst
March 20, 2015 10:50 AM

The FX market seems to be taking a breather from the extreme volatility that followed the FOMC meeting on Wednesday. The statement revealed the removal of the ‘patient’ phrase – as the market had anticipated – which gives the FOMC the flexibility to raise rates. However, the Fed’s dot plot showed a dovish picture with one less hike in 2015 than the market had priced in. Fed Chair Janet Yellen highlighted that a stronger dollar would have a drag on exports, and added that although they had removed ‘patient’ from forward guidance it would not mean the committee would be impatient. She emphasised that the timing of the first rate increase would be completely ‘data dependant’. As a consequence, this turned the dollar bearish which then spun it into free-fall.

The market is likely to remain in a consolidation period as we await the next catalyst. The US CPI data is released on Tuesday which will give some indication on inflation as we hear from FOMC members Dennis Lockhart today and Stanley Fischer on Monday. Reports this morning have suggested that the ECB is considering limitations on Greek banks buying Greek debt. The Greek PM Tsipras last night reconfirmed the Greek acceptance of the bailout program they agreed with creditors in February. The newly elected Greek administration need to appease the ECB, IMF and Euro group as they have some very large repayments over the summer months that need to be monitored for what can only be described as an ‘accidental default’.

The Asian session saw the CNH in the spotlight following a surprising fix for the onshore USD/CNY product by the PBOC at 6.1494. This saw the off-shore CNH rally 80 points. The move has led to speculation that the PBOC wants to guide the market towards a stronger currency.

 

 

EUR/USD
Supports 1.0580-1.0435-1.0340 | Resistance 1.0905-1.1045-1.1224

 

 

USD/JPY
Supports  119.30-118.65-116.70 | Resistance 121.55-123.70-123.70

 

 

GBP/USD
Supports  1.4640-1.4550-1.4350 | Resistance 1.5030-1.5170-1.5250

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024