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
Oil - US Crude
Bullish
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
  • The Australian Dollar still remains vulnerable as it extends losses against its major counterparts. What is the road ahead for AUD/USD, AUD/JPY, AUD/NZD and AUD/CAD? Get your AUD technical forecast from @ddubrovskyFX here: https://t.co/ph20zFv4qS https://t.co/v4g9ATf4rr
  • The ISM manufacturing index plays an important role in forex trading, with ISM data influencing currency prices globally. Learn about the importance of the ISM manufacturing index here: https://t.co/Xr3xtoFpZy https://t.co/De69mTseZN
  • Take a closer look visually at the most influential global importers and exporters here: https://t.co/G58J1dg6y3 https://t.co/D7AeTM5OpH
  • EUR/USD tumbled last week on the day of the ECB’s latest policy announcement, and that weakness is set to continue this week as a flood of major Eurozone economic statistics is released. Get your weekly Euro forecast from @MartinSEssex here: https://t.co/9B4rJnzWuz https://t.co/ENF3xlkuyP
  • 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/rz7fqi8ZEe https://t.co/Gps2Xp32h9
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here: https://t.co/kODPAfJE79 https://t.co/hftCEho1lM
  • Gold price action is primed for volatility next week with the Fed decision on deck. How real yields and the US Dollar react to fresh guidance from Fed officials will be key for gold outlook. Get your weekly gold forecast from @RichDvorakFX here: https://t.co/MzaIl7tPmZ
  • Forex liquidity makes it easy for traders to sell and buy currencies without delay, and also creates tight spreads for favorable quotes. Low costs and large scope to various markets make it the most frequently traded market in the world. Learn more here: https://t.co/arxYmtQeUn https://t.co/rFlQtyQS81
  • Canadian Dollar snapped a three-week losing streak after USD/CAD stalled at key technical resistance. Get your CAD weekly forecast from @MBForex here: https://t.co/BPHuKecwnz https://t.co/73OmuCKfU9
  • Forex quotes reflect the price of different currencies at any point in time. Since a trader’s profit or loss is determined by movements in price, it is essential to develop a sound understanding of how to read currency pairs. Learn how to read quotes here: https://t.co/CNtqrKWDBY https://t.co/KzhQnGiLyt
Euro Bull Trend May Survive Draghi, Heavy Event Risk Ahead

Euro Bull Trend May Survive Draghi, Heavy Event Risk Ahead

John Kicklighter, Chief Strategist
  • Dollar Rally Halted as Risk Aversion Fails to Materialize
  • Euro Bull Trend May Survive Draghi, Heavy Event Risk Ahead
  • Japanese Yen: USDJPY Ends Longest Rally on Record, Now for a Turn?
  • British Pound Rally this Past Week a Relief Move, Not Permanent
  • Canadian Dollar Plunges after Employment Data
  • Australian Dollar Eying 1.0200 as Risk Trends Flutter
  • Gold Faces Near-Term Breakout as Traders Weigh Venezuela, G20, GDP

New to FX?Watch thisVideo; For live market updates, visitDailyFX’s Real Time News Feed

Dollar Rally Halted as Risk Aversion Fails to Materialize

The dollar closed out an astounding week, but can the currency transition its impressive rally into a lasting bull trend? This coming week may very well determine the medium-term ambitions of the world’s most liquid currency. Before looking ahead, it is important to tally the currency’s score up until this point. Through Friday’s close, the Dow Jones FXCM Dollar Index (ticker = USDollar) actually suffered its worst one-day tumble in a month. However, the cumulative strength for the currency would still offer the highest weekly close for the benchmark since September of 2010. Furthermore, a greater legitimacy was given to the dollar’s underlying strength as EURUSD finally capitulated in its biggest drop (2.0 percent through the past week) since before current bull phase began back in late July.

Yet, as important a pair as EURUSD is, it cannot be the sole source of sustained dollar strength. In fact, the two largest individual contributors to its impressive performance over the past week and months are at considerable risk of withdrawing their self-sacrificing support. For the most liquid of currency pairs, the euro has suffered a significant setback this past week as the market fretted the European Central Bank (ECB) would join the movement to devalue its currency in order to remain competitive in a manipulated world. Central Bank President Draghi did mention the currency, but he is far from reversing the trend of a shrinking balance sheet. If FX traders recognize this, it could quickly revive the euro’s relative appeal – as the Federal Reserve has no intention of easing back from its $85 billion-per-month stimulus effort.

Far more crucial to the dollar’s performance over the past months, though, is the contribution made by USDJPY. Here too, the appeal is a competitive devaluation of the yen that bolsters the dollar’s appeal. We know Japanese officials’ intentions are resolute, but the currency has dropped substantially without tangible movement on easing – only threats. Should carry traders (who short the yen for the yield advantage in counterparts) recognize this, the USDJPY carries a considerable proportion of the dollar’s strength.

So, looking ahead, it seems that the dollar’s future is in the hands of its largest counterparts. Yet, there is a way that it can define its own fundamental fate and genuinely advance against most major counterparts: a meaningful drop in risk trends. Whether the catalyst is European GDP figures, the G30 growth forecasts, sequester fears or G20 currency war threats; it wouldn’t take much to ignite such dry tinder.

Euro Bull Trend May Survive Draghi, Heavy Event Risk Ahead

There was little mistaking the euro’s weakness this past week. Through the final trading session, the shared currency dropped against most counterparts; and the losses on the week ranged between 1.0 and 2.8 percent against its various pairings. That said, this wide-spread selling may prove temporary if the currency can keep its head above fundamental water. Critical is the market’s assumption of where the euro stands in the spectrum of the currency war. ECB President Draghi’s remark that a high currency can spill over to the central bank’s inflation and growth mandates, he didn’t spell out a threat to cut rates or link it to fresh stimulus. For tangible efforts, this is a very bullish-euro factor.

The more unpredictable risk to the euro moving forward is the short and medium-term impact that the scheduled docket holds. It seems the market conveniently ignores the fact that the Eurozone is in a recession, but we will certainly be reminded of this reality with the release of 4Q GDP figures from the Eurozone, Greece, German, et al. Another dredged up threat to the currency may come in the form of fear of a returning financial crisis. Finance Ministers are set to discuss Cyprus’ bailout, Greece’s progress and bank bailouts at the start of the week.

Japanese Yen: USDJPY Ends Longest Rally on Record, Now for a Turn?It had to end eventually. USDJPY’s epic 12-week long rally – the longest advance for the pair on record since the Gold Standard was dropped – finally came to an end with Friday’s close. That said, the 9-pip decline week-over-week is hardly an ambitious reversal. Momentum can build with the right encouragement however. At the center of the yen’s weakness is the fear of massive devaluation. This is certainly reasonable concern, but it has also moved well before the effort is realized. With Japan easing back before the G20, we may see traders follow suit.

British Pound Rally this Past Week a Relief Move, Not Permanent

The sterling put in for a monster performance through the end of this past week. In fact, the two-day rally for the pound against the dollar was the biggest this year; and versus the euro and loonie, the sharpest since November 1, 2011. This move began with an unwinding of stimulus expectations and then was parlayed into Prime Minister Cameron’s win at the EU budget. The problem: these aren’t lasting drivers…

Canadian Dollar Plunges after Employment Data

Between a significant miss in the labor data and an unexpected plunge in the housing sector, the Canadian dollar was hammered through Friday. January housing starts posted the biggest drop since April 2009 to the slowest pace since July of the same year. As for jobs, the 21,900-position drop in employment was the biggest in six months; and the downtick in unemployment comes from a drop in participation.

Australian Dollar Eying 1.0200 as Risk Trends Flutter

It’s telling of underlying risk trends when benchmark US equity indexes are closing at five-year highs, but the high-yield Australian dollar fades lower against most counterparts. AUDUSD is down 2.6 percent on the month, and a more serious break lower is dangerously close. Some of this may be due to repatriated ‘safe haven flows’ but if the traditional risk measures (shares) break lower, we will have a new driver: risk.

Gold Faces Near-Term Breakout as Traders Weigh Venezuela, G20, GDP

Gold has found itself into a terminal wedge with less than $20 of range to trade within. In other words, this metal is looking at a meaningful break from congestion in the coming week. Follow through depends on whether the spark is fundamentally derived. Talk of rescuing EZ members Monday, justified devaluation at the G20 or fading growth with 4Q GDP updates all speaks loudly to this alternative store of wealth.

**For a full list of upcoming event risk and past releases, go to www.dailyfx.com/calendar

ECONOMIC DATA

GMT

Currency

Release

Survey

Previous

Comments

0:01

GBP

Lloyds Employment Confidence

-42

Upward trend since a rating of -75 on 12/2011

0:30

AUD

Home Loans (MoM)

0.0%

-0.5%

Volatile data set, 3-yr avg. of 0.1%, Range 3.7% to -5.5%

0:30

AUD

Investment Lending

-3.3%

Wild swings in data set

0:30

AUD

Owner-Occupied Home Loan Valueve (MoM)

0.6%

Growth remained below 2% since 4/2011, including -5.2% on 2/12

7:45

EUR

Industrial Production (MoM)

-0.2%

0.5%

Volatile data set, 5 yr. avg. of -0.1%

7:45

EUR

Industrial Production (YoY)

-2.1%

-3.6%

Previous growth at 3-year low, with 8.9% high on 5/10

7:45

EUR

Manufacturing Production (MoM)

-0.3%

0.2%

Volatile data set 3-year high of 2% on 8/12

7:45

EUR

Manufacturing Production (YoY)

-1.4%

-4.6%

Steady decline from 5-yr. high of 7.6% on 4/10

8:00

EUR

Spanish House Transactions (YoY) (DEC)

-6.1%

Souring mortgage debt is one of the greatest threats to the Spanish banking system and Spain

21:45

NZD

Card Spending - Retail (MoM)

0.3%

0.3%

Volatile data set, growth positive over the 3 consecutive months

21:45

NZD

Card Spending - Total (MoM)

0.4%

5-yr high of 2% on 8/12, avg. of 0.4%

23:50

JPY

Japan Money Stock M2 (YoY)

2.6%

2.6%

Remained at 2% or above since 5-yr. low of 1.8% on 10/08

23:50

JPY

Japan Money Stock M3 (YoY)

2.3%

2.2%

Positive trend since low of 0.5% on 4/08, above 1.5% since 3/09

GMT

Currency

Upcoming Events & Speeches

11:00

USD

Group of 30 Release Global Economy Report

13:30

EUR

Euro-Area Fin Mins Meet (Discuss Cyprus, Greece, Bank Rescues)

18:00

USD

Fed’s Yellen Speaks on Economy in Washington, D.C.

SUPPORT AND RESISTANCE LEVELS

To see updated SUPPORT AND RESISTANCE LEVELS for the Majors, visit Technical Analysis Portal

To see updated PIVOT POINT LEVELS for the Majors and Crosses, visit our Pivot Point Table

CLASSIC SUPPORT AND RESISTANCE

EMERGING MARKETS 18:00 GMT

SCANDIES CURRENCIES 18:00 GMT

Currency

USD/MXN

USD/TRY

USD/ZAR

USD/HKD

USD/SGD

Currency

USD/SEK

USD/DKK

USD/NOK

Resist 2

15.5900

2.0000

9.2080

7.8165

1.3650

Resist 2

7.5800

5.8300

6.1150

Resist 1

15.0000

1.9000

9.1900

7.8075

1.3250

Resist 1

6.8155

5.7350

5.8200

Spot

12.7088

1.7736

8.9165

7.7559

1.2389

Spot

6.4073

5.5620

5.5176

Support 1

12.5000

1.6500

8.5650

7.7490

1.2000

Support 1

6.0800

5.4440

5.5000

Support 2

11.5200

1.5725

6.5575

7.7450

1.1800

Support 2

5.8085

5.3350

5.3040

INTRA-DAY PROBABILITY BANDS 18:00 GMT

\Currency

EUR/USD

GBP/USD

USD/JPY

USD/CHF

USD/CAD

AUD/USD

NZD/USD

EUR/JPY

GBP/JPY

Resist. 3

1.3532

1.5840

94.71

0.9256

1.0041

1.0383

0.8442

127.40

148.97

Resist. 2

1.3502

1.5810

94.41

0.9236

1.0025

1.0361

0.8420

126.91

148.48

Resist. 1

1.3472

1.5779

94.11

0.9216

1.0009

1.0338

0.8399

126.41

147.98

Spot

1.3412

1.5719

93.52

0.9175

0.9978

1.0294

0.8356

125.43

146.99

Support 1

1.3352

1.5659

92.93

0.9134

0.9947

1.0250

0.8313

124.45

146.00

Support 2

1.3322

1.5628

92.63

0.9114

0.9931

1.0227

0.8292

123.95

145.51

Support 3

1.3292

1.5598

92.33

0.9094

0.9915

1.0205

0.8270

123.46

145.02

v

--- Written by: John Kicklighter, Chief Strategist for DailyFX.com

To contact John, email jkicklighter@dailyfx.com. Follow me on twitter at http://www.twitter.com/JohnKicklighter

Sign up for John’s email distribution list, here.

Additional Content:Money Management Video

Trading the News Video

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

DISCLOSURES