Weekly Trading Forecast: Will We See More of Last Week's Exceptional FX and Commodity Volatility?
The Dollar suffered one of its most abrupt swoons in years until NFPs stabilized the currency. Oil and gold meanwhile generated remarkable volatility and tentative stabs at trends. Will we see more of these active markets this week?
A number of major market themes were driven this past week; but for FX, the Dollar’s remarkable volatility grabbed most traders’ attention.
EUR/USD immediately benefited from the market pricing out any Fed rate hikes this year, but price may have gotten too far ahead of itself.
The near-term rebound in GBP/USD may continue to unravel in the week ahead should the Federal Reserve’s semi-annual Humphrey-Hawkins testimony with Chair Janet Yellen highlight a further deviation in the policy outlook.
Last week we looked at the astonishing surprise decision by the Bank of Japan to move to negative interest rates.
The Australian Dollar may resume its long-term down trend after rebounding to a monthly high last week as testimony from Fed Chair Yellen reboots US rate hike speculation.
This week’s moves have put the Bank of Canada, and CAD traders in a precarious position.
Both the offshore (CNH) and onshore yuan (CNY) rates closed higher on Friday after China’s central bank raised the yuan reference against the dollar to a one-month high of 6.5314.
Gold prices rallied for a third consecutive week with the precious metal advancing more than 3.5% to trade at 1157 ahead of the New York close on Friday.
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