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The US dollar could be undervalued if commodities continue to rip higher
Commodities are soaring, and of they continue to do so the US dollar could be undervalued as the case for any Fed cuts could evaporate.
Nasdaq 100 Forecast: QQQ rises on Google, Apple AI chatter
US stocks are pointing to a stronger open, with tech stocks outperforming. Reports that Alphabet's Google and Apple are in talks to include Google's AI Gemini feature in iPhones has boosted the mood. Nvidia's annual developers conference will also kick off today. While tech news is lifting the mood, attention is also on the Federal Reserve interest rate decision on Wednesday, where the Fed could adopt a more hawkish stance given the sticky nature of inflation.
GBP/USD hints at sentiment extreme ahead of BOE, FOMC: COT report
With a BOE and FOMC meeting pending and net-long exposure for GBP/USD at or near a sentiment extreme, I cannot help but wonder if the pound it due at least a pullback. I also take a closer look at the US dollar index (DXY), gold and the Nasdaq 100.
Dow Jones Forecast: DJIA falls on inflation worries
US stocks fall after sticky inflation data this week has raised concerns the Fed may keep rates high for longer. The Fed is not expected to cut rates next week but could downwardly revise its dot plot from three rate cuts in 2024 forecast in December to 2 cuts. The USD is on track for a weekly gain as the Fed could turn more hawkish. Oil is set to rise 3% across the week on signs that the market is tightening.
Fed must commit to finishing the inflation fight to prevent gold upside
Gold traders have a decision to make with fundamental headwinds building from a stronger US dollar and higher bond yields with the price yet to meaningfully respond. What the Fed signals next week looms as crucial for directional risks.
USD bears scramble, USD/JPY eyes breakout after US data: Asian Open
US dollar bears scrambled for cover following hot US economic data ahead of next week’s Fed meeting, helping USD/JPY rise to a 5-day high and eye a potential breakout today.
Dow Jones Forecast: DJIA pares gains after hotter PPI
US futures have pared gains after PPI data highlighted the sticky nature of inflation and raised questions about whether the Fed will be able to cut rates three times this year. The data comes after CPI earlier in the week was also hotter than expected. The market has adjusted its June rate-cut bets, but not by a significant margin, which is keeping stocks elevated. Oil extends gains after a bullish IEA oil market report.
Commodities warning of shifting directional price risks
Gold, copper, silver, crude, cocoa – it’s a rarity to not come across a particular commodity that’s suddenly running hard. Every day there seems to be another one joining the increasingly lengthy list, providing a sense we may be at a turning point for the broader commodity complex.
NASDAQ 100 Forecast: QQQ muted ahead of more data tomorrow
US stocks point to a muted start after yesterday's rally. Investors have shrugged off hotter-than-forecast inflation and remain firm that the Fed will cut rates in the June meeting. US economic data is in short supply today. Attention will be on retail sales and producer prices later in the week. Oil prices pop on an upbeat demand outlook from OPEC.
USD/JPY seems best bet for bulls amid a mixed US dollar environment
The US dollar rose for a second day, but its bearish reversal candle makes it less appealing to bulls. Yet USD/JPY shows promising signs of bullish mean reversion ahead of next week's BOJ and FOMC meetings.
S&P 500 Forecast: SPX rises despite hotter-than-expected inflation
US stocks point to a higher start despite US inflation and core inflation coming in hotter than expected. The sticky inflation reading raises questions over whether the Federal Reserve will be able to cut rates three times this year, as indicated in the dot plot in December. While stocks are rising, gains could be limited. The USD is edging higher after the data. Oil struggles for direction ahead of the OPEC monthly market report.
Dow Jones Forecast: DJIA falls in cautious trade ahead of tomorrow's CPI data
US stocks are pointing to a weaker open, extending losses from last week. Wall Street's main indices dropped on Friday as Nvidia tumbled after mixed US jobs data. Today, the mood is cautious as investors look ahead to Tuesday's inflation data, which could provide more clues about the Federal Reserve's monetary policy outlook. Bitcoin-related stocks rise as the cryptocurrency hits a record high.
Dow Jones Forecast: DJIA rises after a Goldilocks NFP report
US stocks are heading for a stronger open, with the S&P 500 set for another record high after the US non-farm payroll report. While more jobs than expected were added in February, wage growth cooled by more than expected, and unemployment rose, keeping the market optimistic that a June rate cut was still likely. The data comes after Fed Chair Jerome Powell said that the central bank would not be far from loosening monetary policy if inflation continued to cool.
US dollar index on track for its worst week of the year: The Week Ahead
With Fed Chair Jerome Powell effectively delivering a dovish pivot during his testimony to the house Committee, traders will no doubt jump onto weaker US economic data to reprice multiple rate cuts - and that could weigh further on the US dollar.
S&P 500 Forecast: SPX rises on signs of the jobs market cooling
US stocks are set to pen marginally higher, adding to yesterday's gains after jobless claims added to evidence that the US labour market is cooling and ahead of a second day of testimony by Federal Reserve Chair Jerome Powell before Congress. Yesterday, Powell said that a rate cut this year could be likely but gave no clues on the timing or the scale. Neel Kashkari was more hawkish, saying no more than two hikes would be needed this year.
USD/JPY, Nikkei 225: Downside ducks lining up as US bonds go bid
Where US long bond yields have moved in 2023, USD/JPY and Nikkei 225 have tended to follow. Right now, the risks for each are building to the downside.
US dollar extends losses on dovish Powell comments: Asian Open
Jerome Powell said what traders wanted to hear during his testimony to the House Committee; rate cuts are coming.
Dow Jones Forecast: DJIA rebounds ahead of Powell's testimony
US stocks are pointing to a stronger open after yesterday's selloff. The market is rising ahead of Federal Reserve Chair Jerome Powell's testimony before Congress, where the market will be looking for further clues over when the Fed could start to cut interest rates. US ADP payrolls rose to 140k, up from 1.07k, but missed estimates of 150k. The data comes ahead of the non-farm payroll data on Friday.
S&P 500 Forecast: SPX struggles as sentiment softens
US stocks point to a weaker start, extending yesterday's losses as investors look cautiously ahead to Fed Powell's testimony and US jobs data later in the week; today, US ISM services PMI will be released and comes as service sector inflation remains sticky. Atlanta Fed President Raphael Bostic warned that there is no urgency to cut rates; his comments also dented sentiment.
Interest Rate Shock: What Happens If the Fed Hikes Instead of Cuts?
Traders are pricing in a small, but non-zero, chance of a Fed rate hike in 2024. Those odds could grow with a couple more hotter-than-expected inflation reports.
Dow Jones Forecast: DJIA slips in a cautious start ahead of Powell later in the week
US stocks are inching lower after last week's record highs. The mood has turned cautious as investors await further cues from the Fed. Fed chair Jerome Powell testifies before Congress on Wednesday and Thursday and US non-farm payroll data is due on Freiday. Oil is edging lower after strong gains last week in a case of "buy the rumor, sell the fact" regarding OPEC+ extending oil production cuts into Q2.
AUD/USD: Fuel driving US dollar rally may be nearing exhaustion point
Too soon to turn bullish AUD/USD but be ready when the turn eventually comes.
Dow Jones Forecast: DJIA rises after inflation cools
US stocks edge higher after core PCE, and the Fed's preferred inflation gauge cooled in line with forecasts. Core PCE eased to 2.8%, down from 2.9%, although the monthly rate rose to 0.4%, up from 0.2%. Personal spending also slowed to 0.2%, down from 0.7%, in a sign that consumption was slowing. USD/JPY has slumped after the data & after hawkish BoJ chatter.