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
Bearish
Oil - US Crude
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
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
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Bearish
More View more
Real Time News
  • Bank of Japan to mull widening of its long-term yield band -BBG $USDJPY
  • While the rise in longer-dated Treasury yields have been impressive as of late, March highs remain a key focus for resistance The medium-term uptrend remains intact, maintained by rising support from August Fading fiscal stimulus expectations (size) may sour yields ahead https://t.co/L3vBcF0ts7
  • Trading bias allows traders to make informative decisions when dealing in the market. This relates to both novice and experienced traders alike. Start learning how you may be able to make more informed decisions here: https://t.co/rz7fqhRoMG https://t.co/vFJ8zmphMm
  • While the US Dollar has been holding its ground, its downside bias against the Singapore Dollar, New Taiwan Dollar Thai Baht and Indonesian Rupiah remains intact as it hovers at support. Get your market update from @ddubrovskyFX here: https://t.co/p7gAztWuVG https://t.co/zB1pOS6U4D
  • The $VIX is now running 227 trading days above the 20 handle. It is also working its way quickly into a dead-end descending triangle. These don't really break lower... https://t.co/39Pr7YrQ08
  • WTI Crude amongst the many market participants taking a hit today, down almost 3% $WTI $USD https://t.co/eg2phm1wUO
  • The power of suggestion: even though the market recognized the mistake with mixing Tesla founder Musk's suggestion to use the Signal app with the stock SIGL, it is still trading >2,000% above pre-remark levels and maintains heavy volume. Us speculators are an interesting people
  • Forex Update: As of 21:00, these are your best and worst performers based on the London trading schedule: 🇯🇵JPY: -0.07% 🇨🇭CHF: -0.35% 🇪🇺EUR: -0.65% 🇨🇦CAD: -0.75% 🇦🇺AUD: -0.95% 🇳🇿NZD: -1.19% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/6NZVebT00L
  • one final $BTCUSD chart ahead of the weekend bc I think this is going to remain on the move. 35k support has held for now, but prices are testing a big zone of prior resistance (same that held the high on tues morning). break down/out levels in purple below $BTC #Bitcoin https://t.co/TeLrBYJXty https://t.co/MewVjXNrRT
  • Silver selling off during trade, now down over 3% $XAG $USD https://t.co/V69rLJMYcC
DXY Index Remains in Downtrend, Watch this Level

DXY Index Remains in Downtrend, Watch this Level

2018-02-20 12:39:00
Christopher Vecchio, CFA, Senior Strategist

Talking Points:

- DXY Index descending channel since mid-January remains in place, although the bullish daily key reversal on Friday can't be dismissed.

- USD/CAD may be the best place to express a bullish US Dollar bias; otherwise, too early to call turns in EUR/USD, GBP/USD, and USD/JPY.

- Retail trader sentiment suggests a mixed trading environment for the US Dollar this week.

Upcoming Webinars for Week of February 18 to 23, 2018

Wednesday at 6:00 EST/11:00 GMT: Mid-Week Trading Q&A

Thursday at 7:30 EST/12:30 GMT: Central Bank Weekly

Volatility is back. It's time to review the Traits of Successful Traders series to stay grounded with the tenets of risk management.

The US Dollar (via the DXY Index) is working on its third consecutive day of gains, building on the bullish daily key reversal seen at the lows on Friday. While it is tempting to call a bottom in the greenback, DXY remains in its downtrend from mid-January and thus price action can be seen simply as a countertrend move - for now.

It would appear that the US Dollar is taking on a bit more of a safe haven role these days (less of a growth currency role), largely mirroring what's been happening in equity markets: the early-February rebound in the DXY coinciding with the sharp fall in US equity markets; and today, with equity futures pointing lower, the US Dollar has rallied. It's worth noting that the VIX has moved back above 21 today as well - another sign that the recent uptick in volatility is a feature, not a bug, of market conditions now.

In the near-term, with the US Treasury set to issue $258 billion of short-term debt this week, US yields have started to push higher again, giving pause to higher yielding currencies and risk-correlated assets. Earlier today, the US Treasury 2-year note yield hit its highest level since September 2008 while the 10-year yield hit its highest level since January 2014.

But as we've discussed previously over the past week, there is a growing body of evidence to suggest markets are going through a regime change now. The old adage of 'higher yields, higher equities, and a stronger dollar' no longer applies. Likewise, there is evidence of a key relationship surrounding Gold breaking down as well.

Price Chart 1: DXY Index Daily Timeframe (September 2017 to February 2018)

DXY Index Remains in Downtrend, Watch this Level

Accordingly, ignoring the recent noise, the key level traders still need to watch out for in the DXY Index before a sincere bottom can be called is thus 91.01. The DXY Index put in its 2017 bottom at 91.01 on September 8, and since breaking through said level on January 12, price hasn't looked back. The morning doji star candle cluster that formed between January 15-17 - topping out at 90.98 - proved fruitless.

In an environment where volatility has picked up, it is absolutely imperative that traders adjust their risk management perspective. If you haven't yet, it's the right time to review the Traits of Successful Traders series in order to become reacquainted with the tenets of risk management.

See the video above for a technical overview of the DXY Index, EUR/USD, GBP/USD, EUR/GBP, USD/JPY, and USD/CAD.

Read more: FX Markets Look to FOMC Minutes, UK GDP, Canadian & Japanese CPI

--- Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher's e-mail distribution list, please fill out this form

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

DISCLOSURES