News & Analysis at your fingertips.

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.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Mixed
Oil - US Crude
Mixed
Low
High
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
Wall Street
Mixed
Gold
Mixed
GBP/USD
Mixed
USD/JPY
Mixed
More View more
Real Time News
  • After rising back above the 1.60% level to a high around 1.63% earlier today, US 10yr Treasury yields have moved back lower. They are now trading around an intraday low of 1.56%. $USD https://t.co/5hQglZl4fU
  • Discord has walked away from sale talks with $MSFT now eyeing potential IPO
  • here we go, webinar starting right now 1) USD Q2 Weakness 2) Gold brewing bullish potential? 3) Stonks through initial earnings outlays https://www.dailyfx.com/webinars/643096611 https://t.co/ZzY8QuoCko
  • The Euro has slipped to an intraday low amidst the German Greens surging to a lead over Merkel's CDU in a new poll. $EUR $USD https://t.co/gfvNseRNvc
  • $USDCAD has strengthened today, rising to a one week high near the 1.2600 level. The Canadian Dollar has suffered amidst a drop in oil prices and extended travel restrictions. $USD $CAD https://t.co/O2z7grrFYi
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 92.55%, while traders in Germany 30 are at opposite extremes with 80.61%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/RVkYfiOzPq
  • In line with the general risk-off sentiment, oil prices have come under notable selling pressure with both Brent and WTI crude futures falling 2-2.5%. Get your #crudeoil market update from @JMcQueenFX here:https://t.co/K0zJL8BFj1 https://t.co/wMn3kNFhwC
  • Commodities Update: As of 16:00, these are your best and worst performers based on the London trading schedule: Gold: 0.49% Silver: 0.42% Oil - US Crude: -1.41% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/CqYIho6z47
  • Forex Update: As of 16:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.08% 🇯🇵JPY: 0.07% 🇪🇺EUR: 0.04% 🇦🇺AUD: -0.17% 🇬🇧GBP: -0.23% 🇨🇦CAD: -0.30% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/GC3sr4bk5B
  • - Recovery in the US is improving - The increase in Covid cases is concerning, but vaccines give optimism for a return to more normal conditions later this year
Great Euro News Many Have Overlooked

Great Euro News Many Have Overlooked

Kathy Lien, Technical Strategist

Although the markets are fixated on the USDJPY and its latest test of the key 100 level, the political impasse in Italy is now closer to resolution, which is a resoundingly positive development for the euro.

While most market participants are focused on whether USDJPY will break 100 this morning, we are much more interested in how this weekend's Italian Presidential election and European Central Bank (ECB) comments will affect the euro.

After five unsuccessful rounds of elections, Italy finally re-elected Giorgio Napolitano as President. The 87-year-old politician is the first in Italy's history to serve a second term in this role, and the decision by the electoral college to bring back the old guard is a sign that the current political groups prefer to form a new government than hold new elections for Prime Minister.

The euro gapped higher on the news when the FX markets opened in Asia, but the gap has since been filled. The euro is now trading lower against the US dollar as concerns about ECB easing return.

Before we explain why the odds for ECB easing have increased, it is important to discuss Italy's political situation further, as the decision on a President removes a major short-term destabilization risk for the euro. It is no secret that Napolitano prefers forming a government instead of holding elections, and the fact that his re-election was supported by a large coalition of parties is a sign that the political groups also want to avoid messy elections.

Pier Luigi Bersani's inability to gather support for his two candidates forced him to resign as the leader of the Democratic Party, which now needs to nominate a new leader who will likely be more amenable to working with Napolitano. In fact, local papers are saying that Napolitano agreed to a second term on the condition that the parties will work on forming a government. The re-election of Napolitano and the departure of Bersani gets Italy one step closer to resolving its political fiasco, which should be great news for the euro.

The EURUSD, however, was moving towards 1.30 this morning because more European Central Bank officials sound like they support the idea of a rate cut or some form of additional easing from the central bank. As we mentioned before, the ECB has a history of preparing the market for major changes in monetary policy through a consistent shift in tone by policymakers. Last week, Jens Weidmann said the central bank could cut interest rates if new information warrants it, and over the weekend, ECB member Jorg Asmussen also said "the effectiveness of rate cuts is limited, but it’s still possible to do this if data justified it."

ECB member Klaas Knot repeated a sentiment shared by ECB President Mario Draghi at the last monetary policy meeting. He said that the "latest round of forecasts of the data coming in have shown that the risks are on the downside." As a result, this week's Eurozone PMI and German IFO reports will play a central role in setting expectations for ECB policy, as well as help decide whether the EURUSD maintains a break below 1.30.

There are no major US economic reports today except for existing home sales, which is scheduled for release this morning. We don't expect this housing report to have the power to drive USDJPY above 100.

See also: New Bullish Backing for the USD/JPY Rally

By Kathy Lien of BK Asset Management

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

DISCLOSURES