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
Bearish
Oil - US Crude
Mixed
Wall Street
Bullish
Gold
Bearish
GBP/USD
Mixed
USD/JPY
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
  • The price of #gold may continue to exhibit a bullish behavior in June as the pullback from the yearly high ($1765) reverses ahead of the May low ($1670). Get your Gold market update from @DavidJSong here: https://t.co/OeaYtCpcIo https://t.co/UQVPIVCTCP
  • The $USD breakdown has taken the index into confluence support at the objective yearly open. Get your USD technical analysis from @MBForex here: https://t.co/A16XEv6n4d https://t.co/GzEp3gCAe5
  • US equities continue to run higher with the Nasdaq 100 setting a fresh all-time-high, not even three months after giving back almost a third of its value in about a month. Get your #Nasdaq technical analysis from @JStanleyFX here: https://t.co/1LI54uvI8x https://t.co/e9FvSLqfaA
  • The US Dollar may be at risk to losses against some of its #ASEAN counterparts. USD/SGD, USD/PHP, USD/MYR and USD/IDR have recently broken to the downside. Will losses continue? Find out from @ddubrovskyFX here: https://t.co/0RTlj6maTT https://t.co/UyQ4i0AihI
  • The British Pound technical outlook still seems to favor the downside. GBP/CAD may pressure key rising support from August as GBP/AUD could prolong its downtrend. GBP/CHF may fall. Get your $GBP market update from @ddubrovskyFX here: https://t.co/hBOpDKXmfW https://t.co/AJlT2YKeCu
  • USD/JPY is approaching medium-term uptrend resistance and while the outlook remains constructive, the advance may be vulnerable near-term while below confluence resistance. Get your $USDJPY technical analysis from @MBForex here: https://t.co/93D7AyhHtG https://t.co/KQcLLrkMP3
  • AUD/USD has had the most impressive show of trend over the past couple of months with the pair gaining almost 1500 pips from the March low. Get your $AUDUSD technical analysis from @JStanleyFX here: https://t.co/vLz4Rpln3u https://t.co/AOwnJja5V8
  • Has the #Euro been saved? Find out from @CVecchioFX here: https://t.co/eiXfOTyGa6 https://t.co/AyRiYpb4cN
  • U.S. Market Analyst at https://t.co/JsVsSmefgR, Shain Vernier covers - ✔️ Safe haven assets in volatile markets ✔️ Central banks and governments ✔️ How will commodities trade in a recession Only on Trading Global Markets Decoded #podcast. Tune in here: https://t.co/1UmEzEbwiy https://t.co/ygwjGNvS61
  • The $USD, Euro, British Pound and Australian Dollar will all be at the mercy of political developments in Asia, Europe and North America this week. An avalanche of PMI data will set the backdrop. Find out from @ZabelinDimitri here: https://t.co/L8cfAgVx94 https://t.co/THWhPAS6AM
Dollar Traders Await Policy, Growth Comments from Fed’s Yellen

Dollar Traders Await Policy, Growth Comments from Fed’s Yellen

2014-11-13 04:57:00
John Kicklighter, Chief Strategist
Share:

Talking Points:

  • Dollar Traders Await Policy, Growth Comments from Fed’s Yellen
  • British Pound Drops after BoE Report Pushes Back Market’s View of First Hike
  • Euro: The International Protest for More European Stimulus Grows

Dollar Traders Await Policy, Growth Comments from Fed’s Yellen

With the BoE taking a more dovish tack while the BoJ and ECB vow to pursue their unconventional policies, the US Dollar stands to be benefit even if its fundamental backdrop remains ‘status quo’. A modest gain by the Dow Jones FXCM Dollar Index (ticker = USDollar) Wednesday was no doubt inspired by just such an indirect appeal. Locally, the event risk was less than motivating. Data improved modestly but it carried less reach. Meanwhile, the calls from Philly Fed President Plosser to raise rates in the near future and Minneapolis Fed President Kocherlakota’s comments that low inflation demands an extended zero interest rate policy don’t stray from their respective scripts, so there is little to reprice. Perhaps Fed Chairwoman Janet Yellen will offer a more significant shift in views in her opening remarks at the Fed-ECB Global Markets meet.

British Pound Drops after BoE Report Pushes Back Market’s View of First Hike

A drop between 0.6 and 1.8 percent against its major counterparts this past session signals a dovish turn for the British Pound. The impetus for this slide was the Bank of England’s (BoE) Quarterly Inflation Report. In its most detailed evaluation on economic and financial conditions since the last QIR, the group struck a more dovish tone than even the more moderate shift in August. Of particular interest, Governor Mark Carney pushed out the time frame for which inflation would return to the target rate of 2 percent from approximately 18 months to 3 years. He also suggested he may have to send a letter to the Chancellor of the Exchequer in the coming months – customary when inflation is 1 percentage point above or below target. According to Sterling Futures, the market isn’t pricing in the first full hike until after the June 2015 meeting.

Euro: The International Protest for More European Stimulus Grows

ECB President Mario Draghi spoke in Rome this past session, and his comments were familiar. The central banker remarked that the unemployment level in the region is ‘unacceptably’ high, private investment was at its worst levels since 1990 and the economic outlook was troubled. He would further vow to pursue the unconventional policy they have executed in a shot-gun fashion – negative deposit rates, TLTROs, ending bond sterilization, covered-bond purchases. Yet, Draghi also acknowledged that a recovery could not be central bank managed alone. He called on fiscal policy for support. That same plea has been made by the US Treasury, Fed Chair, IMF and OECD the past week.

Australian Dollar Drops after RBA Member Mentions Intervention

Monetary policy that is increasingly attempting to compensate for fiscal and economic shortfalls is being pushed further and further to extremes. The RBA for its part abandoned its warning on the need for further rate cuts earlier this year, but their assessment that the currency was still overvalued has been a mantra. The markets don’t often take central bank’s evaluations of fair value on exchange rate too seriously unless there is a reasonable probability that they could use policy to realize the valuation. RBA Assistant Governor Christopher Kent changed that threat assessment this morning when he remarked alongside the standard ‘Aussie is too high’ comment that direct intervention hasn’t be ruled out. While served in a noncommittal way, the recent efforts of the RBNZ put the markets more quickly on the defensive.

US Oil Sanguine After the EIA Lowers 2015 Price Forecast Sharply

A global economic forecast that is coming off the tracks of recovery continues to weigh the price of oil. US-based WTI crude dropped 1.0 percent Wednesday but managed to hold its losses to a recent structure of congestion. Rather than reassure though, hallmarks of an impending breakout are likely causing energy traders some degree of anxiety. The 20-day average (equivalent to 1 trading month) of the CBOE’s Oil Volatility Index is the highest we’ve seen in two years. A vote for a medium-term bearish resolution was offered up by the US Energy Information Agency which lowered its 2015 price average price forecast from $94.58 predicted in October to $77.75.

Emerging Market: Ruble’s Range is Volatility and Not Inspiring Confidence

Emerging Market capital measures were little changed on the session. The MSCI ETF slipped a modest 0.2 percent to 41.21, the Bloomberg EM sovereign index nudged higher to 145.71 and the JPMorgan volatility index for the segment dropped back 2.6 vols to 8.0 percent. Once again, the FX ranks showed more capital flow. Amongst the most liquid currencies, the Brazilian Real and Korean Won tallied the biggest losses versus the Dollar (0.5 and 0.4 percent respectively). Outshining a few modest gains though was the ever-volatile Russian Ruble which surged 2.4 percent. This jump, however, should not be taken as a sign of recovery. USDRUB is developing some congestion just off record highs, but it isn’t seeing that dampen its volatility. The longer the Ruble lingers near record lows, the greater the risk of a forceful intervention.

Gold Winding Up for Next Break, Will the SNB Vote Prove Bulls’ Salvation

What some would take to be signs of a stabilizing market is more likely evidence that gold is heading towards its next breakout. In terms of price action, the commodity is working itself into yet another diminishing – and ‘terminal’ range that will ultimately have to decide a direction. Adding to this picture, volume behind ETFs and futures show a steady decline in turnover that many consider the calm before a storm. Given the time frame of this setup, the next meaningful thrust the commodity takes will likely be decided on one of the more dynamic rolls – likely a Dollar move. However, not far in the future, we have a G20 meeting that could stray onto the topic of currency manipulation (a theme that generally favors the metal). Further out, the interest surrounding the ‘Save Our Swiss Gold’ vote set for November 30 that would require the SNB to hold 20 percent of reserves in the metal is starting to interest metals traders as it does FX participants. Its passage – still up in the air – would require the central bank to buy 1,500 tons, but over a 5-year horizon. If growth and rates rise over that same period, it can easily offset the forced bid.

**Bring the economic calendar to your charts with the DailyFX News App.

ECONOMIC DATA

GMT

Currency

Release

Survey

Previous

Comments

23:50

JPY

Domestic Corporate Goods Price Index (MoM) (OCT)

-0.40%

-0.10%

Rising on a YoY basis. However, some of the increases might be due to the sales tax increase

23:50

JPY

Domestic Corporate Goods Price Index (YoY) (OCT)

3.30%

3.50%

23:50

jpy

Machine Orders (MoM) (SEP)

-1.00%

4.70%

Machine orders have been contracting since September.

23:50

jpy

Machine Orders (YoY) (SEP)

-0.30%

-3.30%

23:50

JPY

Japan Buying Foreign Bonds (Yen) (NOV 7)

¥806.6B

Two Week ago, Japan bought the most amount of foreign bonds since June 2014. Japan’s buying of foreign stocks has been trending upward this year.

23:50

JPY

Japan Buying Foreign Stocks (Yen) (NOV 7)

¥326.1B

0:00

NZD

ANZ Consumer Confidence Index (NOV)

123.4

Has been trending downward this year.

0:00

NZD

ANZ Consumer Confidence (MoM) (NOV)

-3.40%

0:00

AUD

Consumer Inflation Expectation (NOV)

3.40%

Consumer inflation is lower than the peak on May 2014; however it is higher than the beginning of the year. Consumer inflation expectations are just as important as actual inflation for the RBA.

4:30

JPY

Industrial Production (MoM) (SEP F)

2.70%

Machine Orders on a YoY basis have recently started to contract

4:30

JPY

Industrial Production (YoY) (SEP F)

0.60%

4:30

JPY

Capacity Utilization (MoM) (SEP)

-1.70%

Has been Contracting this year

5:30

CNY

Retail Sales YTD (YoY) (OCT)

12.00%

12.00%

Has been growing at 12% this year. Important as China’s government is trying to make the economy more dependent on consumption

5:30

CNY

Retail Sales (YoY) (OCT)

11.60%

11.60%

5:30

CNY

Industrial Production (YoY) (OCT)

8.00%

8.00%

Industrial production numbers has been increasing at 8 % which is lower than the rate at the beginning of the year

5:30

CNY

Industrial Production YTD (YoY) (OCT)

8.50%

8.50%

5:30

CNY

Fixed Assets Ex Rural YTD (YoY) (OCT)

16.00%

16.10%

Rate of increase has been trending downward

7:00

EUR

German Consumer Price Index (MoM) (OCT F)

-0.30%

-0.30%

Germany’s inflation rate has been declining this year. The decline might show a weakening economy. However, these are final revisions of OCT data.

7:00

EUR

German Consumer Price Index (YoY) (OCT F)

0.80%

0.80%

8:15

CHF

Producer & Import Prices (MoM) (OCT)

-0.30%

-0.10%

It has been showing contraction this year.

8:15

CHF

Producer & Import Prices (YoY) (OCT)

-1.30%

-1.40%

13:30

USD

Initial Jobless Claims (Nov 8)

280K

278K

Initial jobless claims and the continuing claims have been declining which might show a strengthening labor market.

13:30

USD

Continuing Claims (NOV 1)

2349K

2348K

15:00

USD

JOLTS Job Openings (SEP)

4800

4835

19:00

USD

Monthly Budget Statement (OCT)

-$111.7B

GMT

Currency

Upcoming Events & Speeches

8:30

USD

Fed's Dudley Speaks in Abu Dhabi

9:00

EUR

ECB Publishes Monthly Report

9:00

EUR

ECB Survey of Professional Forecasters

17:30

USD

Fed's Plosser Speaks on 'New Normal' in Philadelphia

17:45

USD

Fed Chair Janet Yellen Welcoming Remarks at FED/ECB Event

20:30

USD

Fed's Kocherlakota Speaks on the Bakken Oil Boom at Stanford

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

14.0100

2.3800

12.7000

7.8165

1.3650

Resist 2

7.5800

6.1750

7.2900

Resist 1

13.6800

2.3000

11.8750

7.8075

1.3250

Resist 1

7.5000

6.0900

7.0000

Spot

13.6388

2.2647

11.2617

7.7529

1.2960

Spot

7.4348

6.0094

6.8655

Support 1

13.0300

2.0700

10.2500

7.7490

1.2000

Support 1

6.7750

5.8000

6.3145

Support 2

12.8350

1.7500

9.3700

7.7450

1.1800

Support 2

6.0800

5.7300

6.1300

INTRA-DAY PROBABILITY BANDS 18:00 GMT

\CCY

EUR/USD

GBP/USD

USD/JPY

USD/CHF

USD/CAD

AUD/USD

NZD/USD

EUR/JPY

Gold

Res 3

1.2483

1.5947

116.41

0.9829

1.1519

0.8652

0.7777

143.90

1170.60

Res 2

1.2456

1.5919

116.09

0.9805

1.1496

0.8630

0.7755

143.55

1163.67

Res 1

1.2429

1.5891

115.78

0.9781

1.1474

0.8608

0.7734

143.21

1156.74

Spot

1.2376

1.5835

115.15

0.9733

1.1429

0.8564

0.7690

142.51

1142.87

Supp 1

1.2323

1.5779

114.52

0.9685

1.1384

0.8520

0.7646

141.81

1129.00

Supp 2

1.2296

1.5751

114.21

0.9661

1.1362

0.8498

0.7625

141.47

1122.07

Supp 3

1.2269

1.5723

113.89

0.9637

1.1339

0.8476

0.7603

141.12

1115.14

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.

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

DISCLOSURES

News & Analysis at your fingertips.