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
  • 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/Yl9vM7kO6a https://t.co/otJwnuR7qe
  • The Federal Reserve System (the Fed) was founded in 1913 by the United States Congress. The Fed’s actions and policies have a major impact on currency value, affecting many trades involving the US Dollar. Learn more about the Fed here: https://t.co/ADSC4sIHrP https://t.co/s4lZWdJoXV
  • The US Dollar Index traded higher last week, sustaining its broader uptrend. Conflicting technical signals urge caution, but the directional bias remains skewed to the upside. Get your weekly USD technical forecast from @FxWestwater here: https://t.co/jcwhcsUBEN https://t.co/tKrlrRZlZn
  • Technical analysis of charts aims to identify patterns and market trends by utilizing differing forms of technical chart types and other chart functions. Learn about the top three technical analysis tools here: https://t.co/KDjIjLdTSk https://t.co/MGy9OTXpUI
  • 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
Euro Forecast: ECB Meeting Eyed, Even if Policy is on Preset Course

Euro Forecast: ECB Meeting Eyed, Even if Policy is on Preset Course

Christopher Vecchio, CFA, Senior Strategist
Euro Forecast: ECB Meeting Eyed, Even if Policy is on Preset Course

Fundamental Forecast for EUR/USD: Neutral

- The Euro finished in the middle of the pack last week, with EUR/JPY, EUR/USD, and EUR/CHF leading to the downside – a sign that risk appetite is deteriorating.

- Thursday’s ECB meeting should bring little new information as policy was preset for the next year back at the June meeting; a mention of European banks’ exposure to Turkish borrowers would excite markets.

- The IG Client Sentiment Indexhas turned back to ‘bearish’ for the Euro holding at ‘neutral’ for the prior two weeks.

See our long-term forecasts for the Euro and other major currencies with the DailyFX Trading Guides.

For the second week in a row, the Euro finished in the middle of the pack, losing ground against four of the major currencies while gaining ground against the remaining three. Among the EUR-crosses that lost ground, there is a noticeable pattern: all of the safe havens performed well last week. EUR/JPY led to the downside with a loss of -0.46%, EUR/USD followed lower by -0.42%, and EUR/CHF dropped by -0.39%. Similarly, the Euro gained ground against all of the commodity currencies.

If there is indeed a discernible, negative shift in risk appetite transpiring among developed market currencies, then it’s time to declare that contagion from emerging markets and persistent trade war tensions may have finally started to take their toll.

Coincidentally, given that the emerging market turmoil accelerated upon the release of a report by the Financial Times in early-August that said that the ECB’s supervisory arm was reviewing European banks’ exposure to Turkish borrowers, we’re keenly interested in seeing what ECB President Mario Draghi has to say this Thursday at the ECB’s September policy meeting.

After all, Turkish borrowers owe European banks $194 billion, according to the Bank of International Settlements. A protracted depreciation by the Turkish Lira could very well set off a wave of defaults on these obligations, forcing European banks to write down bad loans. The erosion of excess capital held by European banks could give the ECB pause to its current plans to wind down its QE program by December 2018 and raise rates by “summer 2019.”

Barring a significant discussion over Turkey and the potential contagion, and even though it is a month that will bring forward a new round of Staff Economic Projections, the nature of monetary policy being on a preset course otherwise means that the resulting impact on price action for the Euro should be minimal.

Beyond the ECB meeting, the calendar bears little of interest that will move the needle for the Euro in the coming days. Economic data in general hasn’t been inspiring as evidenced by the stability in readings around neutral in the Eurozone Citi Economic Surprise Index over the past week (from +1.4 to -3.9).

As is customary, positioning warrants a quick mention, if only for record keeping. According to the CFTC’s COT for the week ended September 4, speculators flipped back to net-long the Euro to the tune of 8K contracts, a reversal from the 7.2K net-short contracts held in the week prior. Through September positioning is a non-factor for the Euro (i.e. the risk of capitulation (covering) due to extreme positioning is extremely low).

FX TRADING RESOURCES

Whether you are a new or experienced trader, DailyFX has multiple resources available to help you: an indicator for monitoring trader sentiment; quarterly trading forecasts; analytical and educational webinars held daily; trading guides to help you improve trading performance, and even one for those who are new to FX trading.

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

To contact Christopher, email him at cvecchio@dailyfx.com

Follow him in the DailyFX Real Time News feed and Twitter at @CVecchioFX.

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

DISCLOSURES