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
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
Wall Street
Mixed
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Mixed
More View more
Breaking news

Australia added 114.7k jobs in July, beating 30.0k estimate. Unemployment rate fell to 7.5%, outperforming the 7.8% estimate

Real Time News
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here:https://t.co/sR7HqpK8BI https://t.co/PSyPSFwSQq
  • - #Crudeoil prices could get a tailwind from newly growing US-#Iran political risks - Washington is seeking to extend an arms embargo beyond its October deadline - #Geopolitical tensions are not unfamiliar to oil traders, but is this time different? https://www.dailyfx.com/forex/fundamental/article/special_report/2020/08/13/Crude-Oil-Prices-Brace-for-Impact-with-US-Iran-Tensions-Brewing.html
  • Why financial market traders must monitor both monetary and fiscal policy? Find out from @MartinSEssex here:https://t.co/Fkzk88Y5gm https://t.co/RD5jfhST15
  • If you missed today's live coverage of the Australian jobs reports where I discussed recent price action and the trajectory of $AUDUSD, $AUDJPY and $AUDNZD, check out the recording on YouTube here - https://t.co/DFtslv9p9J
  • Commodities Update: As of 02:00, these are your best and worst performers based on the London trading schedule: Silver: 1.36% Gold: 1.08% Oil - US Crude: -0.07% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/D73pACW7Wo
  • Forex Update: As of 02:00, these are your best and worst performers based on the London trading schedule: 🇪🇺EUR: 0.20% 🇬🇧GBP: 0.19% 🇨🇭CHF: 0.14% 🇦🇺AUD: 0.07% 🇨🇦CAD: 0.04% 🇳🇿NZD: -0.08% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/iWfve22mC7
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 95.74%, while traders in US 500 are at opposite extremes with 78.31%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/pr60jYN4lU
  • Are we witnessing a positive month for the FTSE as bulls take control? Find out here: https://t.co/j89IW0WMY7 https://t.co/JECJAfuFJW
  • #AUDUSD edged slightly higher after better-than-expected jobs report https://t.co/1sG8q6hGcc
  • 🇦🇺 Full Time Employment Chg (JUL) Actual: 43.5K Previous: -38.1K https://www.dailyfx.com/economic-calendar#2020-08-13
Tired of Choppy Dollar Moves? The Coming Week Could be Huge

Tired of Choppy Dollar Moves? The Coming Week Could be Huge

2013-04-27 01:56:00
David Rodriguez, Head of Product
Share:
Tired_of_Choppy_Dollar_Moves_The_Coming_Week_Could_be_Huge_body_Picture_1.png, Tired of Choppy Dollar Moves? The Coming Week Could be Huge

Tired of Choppy Dollar Moves? The Coming Week Could be Huge

Fundamental Forecast for US Dollar: Neutral

The US Dollar (ticker: USDOLLAR) rallied to start the week as the Euro initially fell to multi-week lows, but a sharp reversal left the safe-haven currency lower as the US S&P 500 finished just shy of record peaks.

Directionless forex market price action has proven frustrating, but the week ahead promises significant volatility on potentially pivotal US Federal Open Market Committee (FOMC) and European Central Bank (ECB) interest rate decisions. Top-tier event risk continues through Friday’s US Nonfarm Payrolls report, and it’s little exaggeration to claim that the coming days could define the following month of US Dollar price action.

Market expectations show that the FOMC is extremely unlikely to change interest rates or make concrete adjustments to current monetary policy. Yet a recent rough patch in US economic data suggests that Fed officials could project that aggressive Quantitative Easing measures could remain in place for longer than previously expected.

Forex markets may take their cues from any obvious shift in Fed rhetoric, but the biggest currency mover may come on Thursday’s highly-anticipated European Central Bank interest rate decision. Survey data from Bloomberg News show that approximately 60 percent of all polled Economists believe that the ECB will cut interest rates by 25 basis points. It would be the first such cut since July of last year, and it would reaffirm the central bank’s commitment to limiting the fallout from current European economic crises.

We question the value of an ECB rate cut as official Euro interbank lending rates (EURIBOR) are well-below the ECB’s Main Refinancing rate; the bank’s aggressive lending keeps monetary conditions far easier than the headline interest rate suggests. Overnight Index Swaps, which institutions use to hedge against and/or bet on official interest rate moves, predict that real market rates will stay the same. Yet we can’t argue with the fact that there is considerable disagreement over the future of ECB rates, and many speculate that the central bank could likewise introduce unconventional easing measures. Given Euro Zone unemployment rates at or near multi-decade peaks, the pressure is on the ECB to get more aggressive in its fight against economic malaise.

The combination of the FOMC and ECB rate announcements would normally be enough tocall it a critical week for the EURUSD and Dollar pairs, but end-of-week April US Nonfarm Payrolls data makes it a potential make-or-break for the Greenback versus major currencies. Sharply disappointing March NFPs data ended a streak of better-than-forecast labor market results, but financial market fallout was surprisingly limited. Eurodollar (interest rate) futures initially showed expectations that interest rates would stay unchanged for longer than previously priced in, but those same contracts are now roughly at pre-March NFP levels.

The question is simple: can the US Dollar uptrend survive if NFPs disappoint for the second-consecutive month? Wednesday’s ADP Employment report, ISM Manufacturing Employment result, and statement from the FOMC rate decision may further shape expectations heading into Friday’s labor market print. As it stands, Bloomberg News data shows economists’ forecasts are remarkably consistent. Given 71 responses, the lowest estimate calls for a 100k jobs gain and the highest points to 200k—giving a mean and median forecast of approximately 150k jobs.

Such a tight range leaves ample room for surprises, and we expect to see big US Dollar volatility in the make-or-break week ahead. - DR

New to FX? Register for this free 20 minute course HERE and learn common FX terms like leverage and how to implement conservative amounts.

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

DISCLOSURES

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.