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
Mixed
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
Gold
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
GBP/USD
Bearish
USD/JPY
Mixed
More View more
Real Time News
  • Gold prices remain in a falling wedge pattern that’s been building for more than two months. Get your $XAUUSD technical analysis from @JStanleyFX here: https://t.co/LYSHloh85Z https://t.co/nGqnQKL0KM
  • Commodities Update: As of 18:00, these are your best and worst performers based on the London trading schedule: Gold: 0.06% Oil - US Crude: -0.08% Silver: -1.15% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/AnzuzBr9Yc
  • Germany 30 IG Client Sentiment: Our data shows traders are now at their most net-long Germany 30 since Mar 19 when Germany 30 traded near 8,568.70. A contrarian view of crowd sentiment points to Germany 30 weakness. https://www.dailyfx.com/sentiment https://t.co/tsMt1UlZGO
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.76%, while traders in NZD/USD are at opposite extremes with 73.37%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/D4fyK6ilmD
  • Indices Update: As of 18:00, these are your best and worst performers based on the London trading schedule: FTSE 100: -0.19% Germany 30: -0.20% France 40: -0.25% US 500: -2.42% Wall Street: -2.93% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/2bszQp27Do
  • Commodities Update: NYM WTI Crude 38.38 (-3.69%), ICE Brent Crude 40.29 (-3.54%), NYM NYH Gasoline 111.08 (-2.47%). [delayed
  • Get your Monday market update from @DailyFX Chief Strategist @JohnKicklighter 👇 https://t.co/iUCcev4Dp2
  • US Equity Update: $DJI -3.11% $SPX -2.58% $NDX -2.38% $RUT -2.96% $VIX +18.40% [Delayed]
  • Gold Price Forecast: XAUUSD Coils Ahead of Next Big Break https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/daily_fundamentals/2020/10/26/Gold-Price-Forecast-XAUUSD-XAU-Coils-Ahead-of-Next-Big-Break.html $GLD $Gold $XAUUSD https://t.co/Fq0ubuQI4g
  • https://t.co/lf8u7L4OLg
Euro at Crossroads, ECB and US Nonfarm Payrolls May Set Pace for Q2

Euro at Crossroads, ECB and US Nonfarm Payrolls May Set Pace for Q2

2012-03-30 23:30:00
David Rodriguez, Head of Product
Share:
european_central_bank_us_nonfarm_payrolls_euro_body_Picture_5.png, Euro at Crossroads, ECB and US Nonfarm Payrolls May Set Pace for Q2

Euro at Crossroads, ECB and US Nonfarm Payrolls May Set Pace for Q2

Fundamental Forecast for the Euro: Neutral

The Euro ended the month of March unchanged against the US Dollar (ticker: USDOLLAR), but an otherwise strong first quarter sets the pace for further EURUSD gains in 2012. Yet the coming week of major event risk may prove critical for the Euro and US Dollar as the exchange rate trades near significant technical resistance and at a major crossroads.

All eyes turn to European Central Bank for a highly-anticipated rate decision due April 4, while a potentially game-changing US Nonfarm Payrolls will wrap up what could be a pivotal week in price action. European officials took some pressure off of the Euro as they agreed to boost the firepower of their key bailout funds. Yet it will be important to watch whether ECB President Mario Draghi hints at further monetary policy support for the at-risk Euro Zone economy.

Recent Euro Zone Consumer Price Index data showed year-over-year inflation dip to its lowest levels since August, which may give the ECB the reason it needs to ease policy further. The yearly rate of 2.6 percent remains above official ECB targets of 2.0 percent; yet the trend favors further slowdowns outside of volatile energy prices. Is it enough to warrant further easing? Only the ECB itself can make that decision, and all eyes remain on Draghi’s rhetoric.

Across the Atlantic, the US economic calendar brings its usual slew of early-month data and of course the infamous Nonfarm Payrolls result due Friday. NFP’s are almost always market moving, but March numbers carry extra weight due to recent shifts in rhetoric from US Federal Reserve Chairman Ben Bernanke. Bernanke rekindled speculation that the Fed would enact another wave of Quantitative Easing (QE3) when he warned that the economic recovery seems fragile and the Fed stands ready to increase stimulus if the need arises.

The Chairman specifically cited a sluggish labor market as a risk, but the past several months of US Nonfarm Payrolls data have seen domestic unemployment rates tumble from 9.1 percent in August to 8.3 percent in February.

Ongoing improvements in the US labor market have almost certainly contributed to the best single quarter of Dow Jones Industrial Average gains since Q1, 1998. Is such optimism sustainable? If history is a guide, the Dow move mostly sideways in the quarter that followed those major gains in 1998. It only traded to further highs through the end of the year. And past performance is not indicative of future results, but an 8.1 percent Dow rally in the first three months of 2012 translates to a massive 38.7 percent annualized return. Only 1954 and 1975 produced such lofty annual returns in the Dow dating back to WWII period. One can never say “never”, but a repeat seems unlikely given significant macroeconomic risks across the globe.

If we do see a significant correction in the US Nonfarm Payrolls and similar pullbacks in the Dow, we might expect the safe-haven US Dollar to outperform the Euro and other key currencies (EURUSD decline). Indeed, the Dollar-Dow correlation trades near record strength as US interest rates are near record-lows.

Needless to say, any major surprises in key data and events in the week ahead could be the catalyst to force big moves. We remain in “wait and see” mode as the Euro trades near critical resistance and Q2 promises big moves across financial markets. – DR

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

DISCLOSURES