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.



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

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
Oil - US Crude
Wall Street
More View more
Real Time News
  • The inside bar pattern occurs regularly within financial markets. Incorporating the inside bar strategy can enhance a trader's market analysis. Find out how you can use it from @WVenketas here:
  • Point 3 is not talked about enough. The bureaucratic - dare I say, Leviathan - in most universities is resulting in tuition prices skyrocketing without adding clear value to the students.
  • Think #amzn will gap higher on Monday after Black Friday and the giant move to online shopping?
  • The exponential moving average (EMA) is a derivative of the simple moving average (SMA) indicator. Compared to the SMA, the EMA weighs recent price changes more heavily than later changes in price. Learn how to incorporate the EMA into your strategy here:
  • Traders in the Euro have a big decision to make this weekend: if EUR/USD hits 1.20, will it continue to advance, consolidate or fall back? Get your $EURUSD market update from @MartinSEssex here:
  • The bullish engulfing candle is one of the forex market's most clear-cut price action signals for reversals and continuation. Learn more about this price action trading signal here:
  • The bull flag pattern is a great pattern to add to a forex trader's technical arsenal. Explosive moves are often associated with the bull flag. Learn more about the bull flag pattern here:
  • Defensive stocks have proven critically important when navigating stock market volatility. Find out what are the most defensive stocks here:
  • Dollar Index has broken major uptrend support and risks accelerated losses into the December open. Get your $USD technical analysis from @MBForex here:
  • The MACD is an indicator that uses exponential moving averages (EMA) to determine trend strength along with entry points based on crossovers. Find out how you can use the MACD as a buy/sell signal here:
Bullish Dollar Factors That Backfired

Bullish Dollar Factors That Backfired

2013-05-24 17:00:00
Kathy Lien, Technical Strategist

Better-than-expected US economic data and a general shift towards risk aversion haven’t done much to help the US dollar, and USDJPY could fall below 101 on Friday if US equities lose ground before the close.

Based on the price action in the currency and equity markets on Friday, risk aversion is driving investment flows. The US dollar (USD) is trading higher against all major currencies with the exception of the Japanese yen (JPY) and Swiss franc (CHF). This performance is finally consistent with what we would expect when equities are selling off and comes in contrast to price action in Thursday’s session.

See also: A Trusted Trade That Didn’t Work

The USDJPY tested 101 early in the North American session despite better-than-expected US durable goods orders. Demand for goods made to last for more than a few years rose 3.3% in April after falling 5.9% the prior month. Excluding transportation, orders were still strong, but shipments plunged 1.5%, offsetting some of the optimism. Regardless, this continues a trend of upside US data surprises that will undoubtedly make the Federal Reserve more willing to dial back asset purchases in the third or fourth quarter of this year.

Currency traders have ignored this report, however, and the USDJPY is now pointing lower and poised for a move down to 100. The lack of market-moving US event risks next week means USDJPY may not get much support from US fundamentals.

The EURUSD, on the other hand, is struggling to hold onto its gains following a better-than-expected German IFO report. This is the second piece of key Eurozone data to show improvements in the Eurozone economy. While the European Central Bank (ECB) only cut interest rates at the beginning of the month, we are beginning to see the benefits of a weaker currency through the IFO and PMI numbers, and with time, the recent rate cut will lend additional support to the region.

Looking ahead, the performance of currencies today will largely depend upon whether US stocks see the same intraday reversal the Nikkei did overnight. If stocks end the day in positive territory, USDJPY will most likely remain above 101, but if stocks end Friday down more than 0.75%, USDJPY could find itself below the 101 level.

By Kathy Lien of BK Asset Management

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