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
EUR/USD
Bearish
Oil - US Crude
Mixed
Wall Street
Mixed
Gold
Bearish
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • There is a great debate about which type of analysis is better for a trader. Is it better to be a fundamental trader or a technical trader? Find out here: https://t.co/aVAzFypAg1 https://t.co/7mc19Gxrvm
  • #Gold prices succumbed to selling pressure as the US Dollar soared this past week What is #XAUUSD facing these next few days and can these fundamental forces extend its selloff? Check out my outlook here - https://www.dailyfx.com/forex/fundamental/forecast/weekly/chf/2020/09/26/Gold-Price-Outlook-Rising-US-Dollar-Sinks-XAUUSD-Will-Losses-Extend.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/gPhy0KoW3W
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here: https://t.co/38gTDnpPbn https://t.co/Xtk5g4JQEB
  • 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/3Wked6GBOp https://t.co/SsUguHB39W
  • Key levels in forex tend to draw attention to traders in the market. These are psychological prices which tie into the human psyche and way of thinking. Learn about psychological levels here:https://t.co/1oygcFMFNs https://t.co/aD1ZWhTWZp
  • The price of #oil may continue to trade in a narrow range as the rebound from the September low ($36.13) appears to have stalled ahead of the month high ($43.43). Get your #commodities update from @DavidJSong here: https://t.co/719LgjFmYG https://t.co/SSoqjONUzA
  • The Australian Dollar may extend its slide lower despite the planned easing of Covid-19 restrictions, as the market continues to price in an RBA rate cut on October 6. Get your #currencies update from @DanielGMoss here: https://t.co/HJpngnerzY https://t.co/g6X8ABQDwY
  • The Indian Rupee may be at risk to the US Dollar as USD/INR attempts to refocus to the upside. This is as the Nifty 50, India’s benchmark stock index, could fall further. Get your USD/INR market update here:https://t.co/ed4QR7QQOn https://t.co/gDWYNtm2UY
  • Technical indicators are chart analysis tools that can help traders better understand and act on price movement. Learn more about the importance of technical analysis here: https://t.co/NpC1D8y4Aa https://t.co/Q7TcbrYXjl
  • #Gold prices have plunged nearly 11% off the record highs with a breakout risking further losses. Here are technical trade levels that matter on the XAU/USD weekly chart. Get your #metals update from @MBForex here: https://t.co/7p3jPx6nQd https://t.co/yxymjCHti6
EURUSD May Have Volatile Spikes: Thinner Liquidity on US Holiday

EURUSD May Have Volatile Spikes: Thinner Liquidity on US Holiday

2019-07-04 06:30:00
Dimitri Zabelin, Analyst
Share:

THINNER LIQUIDITY ON US HOLIDAY, EURUSD FORECAST, ITALY BUDGET– TALKING POINTS

  • EURUSD may experience volatility as US market close for July 4 holiday
  • Euro breathes sigh of relief as Rome and Brussels agree on budget deficit
  • Italian 10-year bond yields plummet over 24% as Italy debt risks subside

See our free guide to learn how to use economic news in your trading strategy!

EURUSD VOLATILITY AHEAD?

The magnitude of EURUSD price swings may be amplified because US markets will be closed for the July 4 holiday. This may become particularly evident if breaking news erupts that causes investors to flock to the US Dollar amid greater risk aversion. In the absence of major critical data releases out of the US and EU, markets may take the time to re-assess the fundamental outlook.

A major developed that occurred this week was the decision by the European Commission to not begin the Excessive Deficit Procedure (EDP) against Italy. Rome revised its budget deficit down and narrowly avoided possibly incurring a $4 billion fine. The dispute between the EU and Italy gave markets a headache and was the leading cause behind the spike in Italian 10-year bond yields.

However, as tensions began to ease, investors perceived less risk associated with holding Italian sovereign debt, and the yield subsequently dropped almost 25 percent in 3 days, now trading at its lowest point since October 2016. For now, it seems, investors can breathe a sigh of relief as the third largest Eurozone economy is – for now at least – avoiding plummeting the entire region into a financial crisis.

WILL US STOCK MARKETS RETREAT?

Investors cheered this week’s achievement in the stock markets. The benchmark S&P 500 index reached a new high, breaking past the 3,000 barrier with the Nasdaq and Dow Jones achieving their own respective landmarks. However, negative RSI divergence is signaling slowing underlying momentum as US Treasuries continue to see significant capital inflows against the backdrop of alarming fundamentals.

CHART OF THE DAY: ITALY 10-YEAR BOND YIELDS AT THEIR LOWEST POINT SINCE OCTOBER 2016

Chart Showing Italian 10-year bond yields

FX TRADING RESOURCES

--- Written by Dimitri Zabelin, Jr Currency Analyst for DailyFX.com

To contact Dimitri, use the comments section below or @ZabelinDimitrion Twitter

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

DISCLOSURES