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  • Bond markets will be on edge all week, with several measures of inflation due from around the globe (Mexico, China, US, Australia, Brazil, Germany, and India). Get your market update from @CVecchioFX here:https://t.co/DO83Zc6UQu
  • Bitcoin bears exert force, driving Bitcoin back below the 50k psychological level BTC/USD support showing around a Fibonacci level. Get your $btc market update from @Tams707 here:https://t.co/2Kf1ZV0PjC https://t.co/B3XO6V3QYD
  • Time to break out some ratios like commercial real estate property tickers (eg $SPG) relative to Amazon ($AMZN) or Carnival Cruise ($CCL) relative to Netflix ($NFLX)
  • Forex Update: As of 21:00, these are your best and worst performers based on the London trading schedule: 🇨🇦CAD: -0.07% 🇬🇧GBP: -0.11% 🇦🇺AUD: -0.42% 🇪🇺EUR: -0.54% 🇳🇿NZD: -0.59% 🇨🇭CHF: -0.63% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/VvEMwfDftX
  • Rising yields (the aggregate yield I mentioned earlier is overlaid and inverted in red here) is dragging gold lower. The 60-day correlation (3 trading month) between $GC_F and yields is the strongest net negative since Oct 2019 https://t.co/Myo0FlsvJA
  • Commodities Update: As of 21:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: -0.42% Silver: -0.47% Gold: -1.10% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/fxdEWv4bfo
  • The Australian Dollar now risks a deeper March correction with the AUD/USD price reversal approaching multi-month uptrend support. Get your $AUDUSD market update from @MBForex here:https://t.co/jYfBrd5b22 https://t.co/tbU9BM3n3L
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 92.43%, while traders in Germany 30 are at opposite extremes with 80.92%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/W16EBX7wwK
  • US equities end the day mixed, as market participants continue to rotate $DOW 31801.91 +0.97% $SPX 3821.22 -0.54% $NDX 12299.0 -2.92% $RTY 2202.99 +0.49% $VIX 26.24 +6.41%
  • Indices Update: As of 21:00, these are your best and worst performers based on the London trading schedule: Wall Street: -0.01% US 500: -0.01% France 40: -0.28% Germany 30: -0.29% FTSE 100: -0.34% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/LqhrKYMQFh
3 Major Pairs Trading at Key Levels

3 Major Pairs Trading at Key Levels

Kathy Lien, Technical Strategist

Political and economic factors have pushed EUR/USD below 1.30, while the British pound and Australian dollar have both fallen to mid-term lows against the greenback.

Currencies are on the move today with the British pound (GBP) dropping to its lowest level in more than two years, the euro breaking below 1.30, and the Australian dollar (AUD) poised for a test of its four-month low against the US dollar (USD).

Weaker manufacturing conditions in China contributed to the selloff, but it was disappointing UK manufacturing PMI and the European Central Bank (ECB) report regarding subpar LTRO payments today that drove the EUR and GBP sharply lower.

The ECB reported that European banks made only EUR12.5 billion in LTRO payments, as compared to EUR67 billion last week. Lower LTRO repayments are negative for the euro because this reflects concerns about liquidity needs inside European banks.

In Italy, Pier Luigi Bersani confirmed that he is ruling out a grand coalition with the center right party, adding pressure to the euro. Yet despite the decline in the currency, Italian bond yields are up only 6 basis points (bps), which is nominal. At 4.78%, ten-year Italian yields are far from reaching dangerous levels.

Sequester Hits with Minimal Impact

With the sequester kicking in at the end of the day, US stock futures were pointing to a lower open. President Barack Obama is meeting with Congressional Leaders today, but with the House out of session, nothing can be done to avoid the forced spending cuts from being enacted.

Investors still continue to buy US dollars, however, because they are not overly concerned about the consequences of sequester. We've been down this road before with the debt ceiling and survived, afterall.

See related: Sequester Kicks in, but Panic Doesn’t

There are also a number of US economic reports on the calendar today. Personal income and personal spending numbers have already been released, and according to the reports, declining incomes have left Americans more conservative with their spending. Personal income dropped 3.6% in January, the largest decline in 20 years. Personal spending rose 0.2%, but last month's report was revised down to 0.1% and the PCE deflator held steady in the month of January.

The disappointment in personal spending will add pressure on futures and risk currencies. The University of Michigan consumer confidence survey, construction spending, and ISM manufacturing numbers will also be released, but we don't expect any market-moving surprises there.

By Kathy Lien of BK Asset Management

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

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