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
EUR/USD
Bullish
GBP/USD
Mixed
USD/JPY
Bearish
Gold
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
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
Bitcoin
Bullish
More View more
Real Time News
  • RT @IGSquawk: US Opening Calls: #DOW 27241 +0.57% #SPX 3149 +0.63% #NASDAQ 8912 +0.88% #RUSSELL 1584 +0.81% #FANG 3515 +0.39% #IG…
  • Canadian Dollar Price Outlook: Loonie Drop Threatens USD/CAD Breakout https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/daily_fundamentals/2020/02/26/Canadian-Dollar-Price-Outlook-JS-Loonie-Drop-Threatens-USD-CAD-Breakout-US-Dollar-to-Canadian-Dollar-USDCAD.html $USDCAD https://t.co/5zzJRuntjb
  • Have you joined @DailyFX @facebook group yet? Discuss your #forex strategies and brush up on your skills with us here: https://t.co/jtY1G7g8yx https://t.co/U1BFER0tMZ
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.58%, while traders in USD/CAD are at opposite extremes with 70.44%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/Gh17w3mzjI
  • Forex Update: As of 13:00, these are your best and worst performers based on the London trading schedule: 🇨🇭CHF: 0.09% 🇪🇺EUR: -0.06% 🇨🇦CAD: -0.19% 🇳🇿NZD: -0.41% 🇦🇺AUD: -0.58% 🇬🇧GBP: -0.63% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/F2LdCNZ6Po
  • Heads Up:🇪🇺 EUR ECB President Lagarde Speaks in Wiesbaden, Germany due at 13:30 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-02-26
  • Currently #ZAR outperforming BRICS peers suggesting positive reception to #BudgetSpeech2020 https://t.co/plC0BZxmQk
  • #BudgetSpeech2020 quick chart showing expenditure in #ZAR (bn) and as a % of total https://t.co/tYhwNdWIY8
  • The $AUD has risen in anticipation of a deal Washington and Beijing. But the Australia-China trade relationship has not suffered much and may even have been helped by China’s spat with the US. Get your market update from @DavidCottleFX here:https://t.co/An7h5X0Zcz https://t.co/aQDY7APzDP
  • 1.0890 proving to be a stubborn area of resistance $EURUSD https://t.co/KNICCimjDk
Elevated Geopolitical Tensions Help US Dollar Retain Some Bids

Elevated Geopolitical Tensions Help US Dollar Retain Some Bids

2011-02-21 06:41:00
Joel Kruger, Technical Strategist
Share:

The US Dollar has managed to find some relief into European trade on the holiday Monday (US will be closed for President’s Day) after the Greenback had been hit hard against the Euro on Friday following some ultra hawkish comments from ECB Bini Smaghi who said that the European Central Bank would be ready to look to raise rates should price pressure mount. The escalation of geopolitical tensions in North Africa and the Middle East on the back of comments from Libyan Gaddafi’s son who warned of the potential for a civil war, have helped to flow some funds back into the buck, while the latest vote in the US House to cut spending, and German Chancellor Merkel’s CDU heavy defeat in Hamburg over the weekend have also not helped risk appetite.

Elsewhere, the G20 meeting over the weekend failed to produce any material market moving results, and this has come as no surprise with the group having a reliable track record of failing to move markets. In short, the G20 have agreed on the principle of tracking indicators of imbalances, and this is way too vague and broad to create any clear short-term result. In fact, the process looks like it will be very long and drawn out with much of the subject matter open to interpretation. Click here for full communiqué.

On the data front, things were relatively quiet in Asia with UK Rightmove house prices coming in generally better than previous, while New Zealand credit card spending was also improved. Japanese all industry activity failed to produce any market moving reaction, but China HSBC flash PMIs were not to be ignored, with the reading coming in softer than expected and helping to perpetuate fears of further slowing within the Chinese economy.

Looking ahead, Swiss money supply is due at 8:00GMT, followed by German services PMI (60.2 expected), German manufacturing PMI (60.3 expected) at 8:30GMT. Eurozone composite PMI (56.9 expected), manufacturing PMI (57.2 expected) and services PMI (55.9 expected) are then out at 9:00GMT, along with German IFO readings. The calendar for the remainder of the day is empty as US traders enjoy the long holiday weekend. US commodity prices are well bid led by oil (geopolitical fears).

TECHNICAL OUTLOOK

Elevated_Geopolitical_Tensions_Help_US_Dollar_body_eur.png, Elevated Geopolitical Tensions Help US Dollar Retain Some Bids

EUR/USD:The market looks to be in the process of seeking out a fresh lower top below 1.3745 ahead of the next downside extension towards the measured move objective off of a head & shoulders top formation which comes in by 1.3300. Look for confirmation of a fresh lower top on a break back below 1.3425. As such, we like the idea of fading the most recent rally above 1.3700, with only a break and close back above 1.3745 negating short-term outlook and giving reason for pause.

Elevated_Geopolitical_Tensions_Help_US_Dollar_body_jpy2.png, Elevated Geopolitical Tensions Help US Dollar Retain Some Bids

USD/JPY: The market continues to remain extremely well bid, with the latest surge back above 83.00 really encouraging longer-term recovery prospects and opening the door for a potential break of key topside resistance by 84.50 over the coming days. Longer-term cyclical studies certainly suggest that the market could be poised for a major bullish reversal and we would look for a break and weekly close back above 84.50 to help confirm outlook. Any dips from here should be well supported ahead of 82.50, while only a break and close back below 82.00 would concern.

Elevated_Geopolitical_Tensions_Help_US_Dollar_body_gbp2.png, Elevated Geopolitical Tensions Help US Dollar Retain Some Bids

GBP/USD: The market largely remains locked in some consolidation after stalling out by key resistance at 1.6300 several days back. From here, it is difficult to establish a clear directional bias and we will need to see a sustained break above 1.6300 or back below 1.5960 for additional clarity. In the interim, we remain sidelined.

Elevated_Geopolitical_Tensions_Help_US_Dollar_body_swiss1.png, Elevated Geopolitical Tensions Help US Dollar Retain Some Bids

USD/CHF: The market has been in the process of pulling back after stalling out ahead of key short-term resistance by 0.9785 in the previous week. Still we see any additional declines well propped above 0.9425 (minor 78.6% fib retrace) on a close basis and look for the formation of a fresh higher low ahead of the next major upside extension back through 0.9785 and towards more critical resistance by 1.0070 further up. Only a close below 0.9425 will give reason for concern.

Written by Joel Kruger, Technical Currency Strategist

If you wish to receive Joel’s reports in a more timely fashion, email jskruger@dailyfx.com and you will be added to the distribution list.

If you wish to discuss this or any other topic feel free to visit our Forum Page.

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

DISCLOSURES

News & Analysis at your fingertips.