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. See our updated Privacy Policy here.

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
Wall Street
Bearish
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
More View more
Real Time News
  • Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Learn about FX leverage here: https://t.co/BdgFmkRxVw https://t.co/fIO9TP7D62
  • Trading Forex is not a shortcut to instant wealth, excessive leverage can magnify losses, and sentiment is a powerful indicator. Learn about these principles in depth here: https://t.co/lZFM8youtX https://t.co/Xja8DHUqlH
  • Risk management is one of the most important aspects of successful trading, but is often overlooked. What are some basic principles or risk management? Find out from @PaulRobinsonFX here: https://t.co/IsnpfJhp91 https://t.co/9po5Lg4vnR
  • The Japanese Yen is eyeing the upcoming Bank of Japan rate decision and CPI figures, but JPY crosses will likely remain dependent on broader market sentiment. Get your weekly $JPY forecast from @FxWestwater here: https://t.co/x9rbQpPfWe https://t.co/2x1R5XTVea
  • Consolidation or bull flag? A bull flag is a continuation pattern that occurs as a brief pause in the trend following a strong price move higher. Learn how to better spot these formations here: https://t.co/yOEvLjKnct https://t.co/uCaWQiu4Ly
  • Crude and Brent oil are on track to extend higher as Gulf Coast supply disruptions and a positive OPEC report bolster sentiment. Uranium is on a massive surge, aided by the famous Wall Street Bets group. Get your market update from @FxWestwater here:https://t.co/XrpV0jcy8e https://t.co/g2To3LmUah
  • RT @michaeljburry: Read thread.
  • The Australian Dollar has retraced from August lows when looking at AUD/JPY and AUD/CAD. However, the AUD/NZD downtrend is intact, will a reversal there appear as well? Find out: https://t.co/8LmgqLLGJO https://t.co/AueigVsuk4
  • The S&P 500, Dow Jones and DAX 30 could be at risk of falling as retail traders continue increasing their upside exposure in these indices. What are the key technical levels to watch for? Find out from @ddubrovskyFX here:https://t.co/OJByiwIppr https://t.co/P1iOONG90N
  • The US Dollar continues to hold its ground against most ASEAN currencies as recent downtrends lose momentum. What is the road ahead for USD/SGD, USD/THB, USD/PHP and USD/IDR? Find out from @ddubrovskyFX here:https://t.co/UcleaZEAaW https://t.co/62bGLvt8fE
Retail Sales Decrease, but Taper Talk Doesn't

Retail Sales Decrease, but Taper Talk Doesn't

Kathy Lien, Technical Strategist

Though today’s US retail sales data was slower than expected, the markets saw enough consumption to bid the dollar higher and sustain confidence about the prospects for Fed tapering starting in September.

The most important data point on the economic calendar this week is today’s US retail sales report. While the level of consumer spending was far from impressive, consumption was firm enough to sustain speculation that the Federal Reserve will taper asset purchases this year.

Retail sales growth slowed to 0.2% in the month of July, down from 0.6% in June, but excluding volatile auto and gas purchases, spending grew 0.4% after stagnating the prior month. The US dollar (USD) had been trading higher for most of the morning and extended its gains after the market learned that this was the fourth consecutive month of positive US retail sales growth.

We hoped to see retail sales grow by more than 0.7%, but based on the reaction in the foreign exchange market, it is clear that investors feel that the data is good enough to keep the hawks talking about reducing purchases over the next two months, which is good for the dollar.

At the same time, however, we do not feel that the data is strong enough to solidify expectations for Fed tapering, which means investors are left guessing as to how quickly the central bank will act. Until the release of the July Federal Open Market Committee (FOMC) meeting minutes on August 21 and the Jackson Hole Federal Reserve Summit on August 22, we won't get much additional clarity on where the central bank stands because the rest of the data this month is second tier in nature.

This suggests that while we have seen a nice rally in the US dollar in reaction to today’s retail sales data, we continue to see the EURUSD trading between 1.3100 and 1.3450 and GBPUSD between 1.53 and 1.57 in the near term.

See related: 2 Rock-Solid Ranges for EUR/USD, GBP/USD

The USDJPY, on the other hand, could be poised for additional gains because at the end of the day, the Fed is still gearing up to reduce asset purchases…the only question is, when?

There is significant resistance for USDJPY near 98.75, but ten-year Treasury yields have responded very positively to today's data, and if yields continue to rise, this level can be broken.

Atlanta Federal Reserve President Dennis Lockhart is scheduled to speak on the economy later today, but as a non-voting member of the FOMC this year, his comments will have limited impact on the dollar.

By Kathy Lien of BK Asset Management

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

DISCLOSURES