We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
More View more
Real Time News
  • Join @CVecchioFX 's #webinar at 7:30 AM ET/12:30 PM GMT as he discusses the most relevant information from the world's most influential central banks. Register here: https://t.co/HyPgSrhjor https://t.co/LUyRHyKj9m
  • How can you use PPI in #forex trading? Find out: https://t.co/TZEdU2SdaS #tradingstyle https://t.co/j1gwxGHxEw
  • Commodities Update: As of 11:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.50% Silver: 0.03% Gold: 0.02% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/rrt98FyJ1J
  • RT @jsblokland: Eurozone industrial production down 2.2% YoY in October, slightly better than expected, but also marking the 12th consecuti…
  • Forex Update: As of 11:00, these are your best and worst performers based on the London trading schedule: 🇦🇺AUD: 0.18% 🇨🇦CAD: 0.04% 🇨🇭CHF: 0.03% 🇳🇿NZD: -0.02% 🇯🇵JPY: -0.10% 🇬🇧GBP: -0.17% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/LVaaG2tsBV
  • RT @LiveSquawk: China Needs To Step Up Contingency Planning As Global Risks Are Increasing – Xinhua
  • $GBPUSD dropping to session lows of 1.3150 https://t.co/jKnLDw6Oln
  • Indices Update: As of 11:00, these are your best and worst performers based on the London trading schedule: US 500: 0.11% Wall Street: 0.04% France 40: 0.03% Germany 30: 0.02% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/Dc2abERM7f
  • Trade conflict is clearly awful for the broad world economy, but some countries are already benefiting from it. More stand to do so. Spotting them early could be profitable. Get your update on the #tradewar from @DavidCottleFX here: https://t.co/og0VAPAqwm https://t.co/MuqUMEcZR9
  • LIVE NOW: Join Currency Strategist @PaulRobinsonFX as he discusses a wide range of topics with emphasis on psychology, trade execution, and risk management with the goal of helping traders improve performance. Register here: https://www.dailyfx.com/webinars/602330483?CHID=9&QPID=917720
Euro Diverges From Risk Creating Potential Opportunity

Euro Diverges From Risk Creating Potential Opportunity

2010-03-22 20:02:00
John Rivera, Currency Analyst


Greece’s troubles have caused ERU/USD price action to diverge from equity markets which we saw at onset of the issue. The potential that a bailout package from E.U. member nation may not be forthcoming has pressured the single currency. Risk sentiment has seen its explanatory power over the pair’s direction fall to 40% from 48% a month ago. Meanwhile, the prospect for a U.S. rate hike has improved slightly which has added weight to the euro/dollar as their negative correlation increased to 20% from 10 a week ago. We recently saw a similar divergence between the USD/JPY and equity markets which generated a profit opportunity as the currency pair saw support increase shortly thereafter, outing back on trend with risk appetite. Although, extenuating circumstances in Europe could prevent a similar reaction, the relationship should be monitored by traders if risk appetite continues.


ECB Interest Rate Expectations

Overnight index swaps are now pricing in 67 bps of rate hikes over the next twelve months as yield expectations have begun to trend sideways with the ECB expected to remain on hold for the foreseeable future. Inflation held at 0.9% in February which is well below the central bank’s 2.0% target. Policy makers will be able to remain on hold as long as price growth isn’t a threat. The upcoming German IFO and Euro-Zone PMI reading could influence the outlook for yields if they point toward an accelerating recovery for the region. However, German officials recently expressed concerns that growth in Europe’s largest economy has been reliant in unsustainable foreign demand. Discuss this and trading ideas join the EUR/USD forum.


FOMC Interest Rate Expectations

Rumors that the Fed will raise the discount rate for a second time before their April meeting has raised the outlook for a rate hike on Friday. The central banks continuing their language that they will keep rates “exceptionally low” for an “extended period” last week will limit the prospect for tightening. Markets are only pricing in a 28.6% chance of a rate increase by August. Upcoming existing home sales and durable goods data isn’t expected to raise the outlook for yields. Housing demand is forecasted to slip 1.4% with demand for long lasting goods expected to improve slightly by 0.5%.



The passing of the Health Reform bill helped equity markets overcome a slow start as drug and technology shares rallied. The level of risk appetite was impressive given increase global growth concerns and troubles in Europe. The Dow is approaching pre-Lehman levels which markets could look to test before any significant pullback. Continued demand for risky assets could lead to a EUR/USD reversal as it remains the main driver of price action. Discuss this and other fundamental data join the Economics Forum.


To discuss this report or be added to the email list contact John Rivera, Currency Analyst: instructor@dailyfx.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.


News & Analysis at your fingertips.