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
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
More View more
Real Time News
  • Forex Update: As of 10:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.67% 🇨🇦CAD: 0.47% 🇬🇧GBP: 0.38% 🇪🇺EUR: 0.28% 🇨🇭CHF: 0.18% 🇯🇵JPY: 0.08% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/bdhmxpyRrk
  • Heads Up:🇪🇸 Business Confidence (JUL) due at 10:30 GMT (15min) Previous: -1.1 https://www.dailyfx.com/economic-calendar#2021-07-29
  • Indices Update: As of 10:00, these are your best and worst performers based on the London trading schedule: FTSE 100: 0.81% France 40: 0.72% Wall Street: 0.43% Germany 30: 0.33% US 500: 0.22% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/udphpYMn5y
  • 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/SkopOpNy3P
  • US Dollar Trend Still Points Higher After FOMC, Q2 GDP Eyed - https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/euro_open/2021/07/29/US-Dollar-Trend-Still-Points-Higher-After-FOMC-Q2-GDP-Eyed.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Spivak&utm_campaign=twr #USD #dollarindex #Fed #FOMC #GDP https://t.co/9ppEljRFq6
  • 💶 Industrial Sentiment (JUL) Actual: 14.6 Expected: 13 Previous: 12.8 https://www.dailyfx.com/economic-calendar#2021-07-29
  • 💶 Economic Sentiment (JUL) Actual: 119 Expected: 118.5 Previous: 117.9 https://www.dailyfx.com/economic-calendar#2021-07-29
  • 💶 Consumer Confidence Final (JUL) Actual: -4.4 Expected: -4.4 Previous: -3.3 https://www.dailyfx.com/economic-calendar#2021-07-29
  • Heads Up:💶 Industrial Sentiment (JUL) due at 09:00 GMT (15min) Expected: 13 Previous: 12.7 https://www.dailyfx.com/economic-calendar#2021-07-29
  • Heads Up:💶 Economic Sentiment (JUL) due at 09:00 GMT (15min) Expected: 118.5 Previous: 117.9 https://www.dailyfx.com/economic-calendar#2021-07-29
USD To Consolidate With Fed Hawks On Tap, JPY At Risk On BoJ Policy

USD To Consolidate With Fed Hawks On Tap, JPY At Risk On BoJ Policy

David Song, Strategist

Index

Last

High

Low

Daily Change (%)

Daily Range (% of ATR)

DJ-FXCM Dollar Index

9757.04

9790.04

9741.44

-0.25

99.06%

USD_To_Consolidate_With_Fed_Hawks_On_Tap_JPY_At_Risk_On_BoJ_Policy_body_ScreenShot038.png, USD To Consolidate With Fed Hawks On Tap, JPY At Risk On BoJ Policy

The Dow Jones-FXCM U.S. Dollar Index (Ticker: USDollar) is trading 0.29 percent lower from the open after moving 99 percent of its average true range, and the dollar may continue to lose ground during the North American trade as the FOMC Interest Rate Decision continues to fuel risk-taking behavior. As the Fed takes additional steps to encourage a stronger recovery, the expansion in the monetary base certainly reinforces a bearish outlook for the greenback, but we may see the dollar consolidate in the week ahead as a wedge formation appears to be taking shape in the 30-minute relative strength index. As the oscillator continues to come off of support around the 13 figure, we may see a short-term correction unfold next week, and the index may work its way back towards the 9,800, which would threaten the downward trendline from earlier this month.

USD_To_Consolidate_With_Fed_Hawks_On_Tap_JPY_At_Risk_On_BoJ_Policy_body_ScreenShot039.png, USD To Consolidate With Fed Hawks On Tap, JPY At Risk On BoJ Policy

Although the slew of positive developments coming out of the U.S. economy propped up risk-sentiment, the data suggests that the economic recovery is still gradually gathering pace, and the economic docket on tap for next week may further instill an improved outlook for the U.S. as the housing market starts to pick up. In turn, Fed officials may sound more upbeat going forward, and we may see a growing rift within the central bank as the region continues to face a limited risk for a double-dip recession. As we have Fed hawks scheduled to speak next week, we may see mixed views surrounding the new asset purchase program, and a growing number of central bank officials may voice their dissent against the expansion in the monetary base as growth and inflation picks up. In turn, we may see the USDOLLAR holds above the 38.2 percent Fibonacci retracement around the 9,710 figure, but we will be keeping a close eye on the relative strength index as it dips into oversold territory. Indeed, the oscillator needs to move back above 30 to see a meaningful correction in the index, but the greenback may face additional headwinds over the near-term as risk-trends continue to dictate price action in the currency market.

USD_To_Consolidate_With_Fed_Hawks_On_Tap_JPY_At_Risk_On_BoJ_Policy_body_ScreenShot040.png, USD To Consolidate With Fed Hawks On Tap, JPY At Risk On BoJ Policy

The greenback weakened against three of the four components, led by a 1.16 percent rally in the Euro, while the Japanese Yen bucked the trend as market participants raised their appetite for risk. As market participants turn their attention to the Bank of Japan interest rate decision scheduled for the following week, there’s growing speculation that the central bank will act this month amid the persistent strength in the local currency, and Governor Masaaki Shirakawa may come under increased pressure to intervene in the FX market as Finance Minister Jun Azumi pledges to take ‘decisive action’ to address the downside risks surrounding the region. However, the BoJ may opt to expand its balance sheet further as it struggles to achieve the 1 percent target for inflation, and we should see the central bank continue to carry out its easing cycle throughout the second-half of the year amid the ongoing threat for deflation.

--- Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, send an e-mail with subject line "Distribution List" to dsong@dailyfx.com.

Join us to discuss the outlook for the major currencies on the DailyFX Forums

Meet the DailyFX team in Las Vegas at the annual FXCM Traders Expo, November 2-4, 2012 at the Rio All Suite Hotel & Casino. For additional information regarding the schedule, workshops and accommodations, visit the FXCM Trading Expo website.

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

DISCLOSURES