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
Subscribe
Please try again
EUR/USD
Mixed
Oil - US Crude
Bearish
Wall Street
Mixed
Gold
Bullish
GBP/USD
Mixed
USD/JPY
Mixed
More View more
Real Time News
  • Commodities Update: As of 03:00, these are your best and worst performers based on the London trading schedule: Silver: 0.40% Gold: -0.05% Oil - US Crude: -0.23% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/YeFZeGAfDd
  • Dealing with the fear of missing out – or FOMO – is a highly valuable skill for traders. Not only can FOMO have a negative emotional impact, it can cloud judgment and overshadow logic. Learn how you can control FOMO in your trading here: https://t.co/lgDf5cVYOn https://t.co/0R0BcQrzFG
  • Forex Update: As of 03:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.34% 🇦🇺AUD: 0.23% 🇨🇦CAD: 0.22% 🇪🇺EUR: 0.03% 🇯🇵JPY: -0.01% 🇨🇭CHF: -0.03% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/umNdpg33Bg
  • #Bitcoin, #Ethereum Outlook: ETH Poised to Outperform BTC in Near Term - https://www.dailyfx.com/forex/market_alert/2021/01/25/Bitcoin-Ethereum-Outlook-ETH-Poised-to-Outperform-BTC-in-Near-Term.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Moss&utm_campaign=twr $BTC $ETH $BTCUSD $ETHUSD https://t.co/Pc6e2Grumq
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 100.00%, while traders in Wall Street are at opposite extremes with 64.73%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/ArnUc6hllq
  • Tune in to @IlyaSpivak 's #webinar at 10:00 PM ET/3:00 AM GMT for insight on the cross-market outlook in the week ahead. Register here: https://t.co/E213bTtq5C https://t.co/Sj2NSgZ4xD
  • Central banks often deem it necessary to intervene in the foreign exchange market to protect the value of their national currency. Learn how central bank intervention can impact your trading here: https://t.co/8G8mUX4so6 https://t.co/MAn2EL32sU
  • In the week ahead, around 25% of S&P 500 companies will release their results, including GE, Johnson & Johnson, 3M, Microsoft, Boeing, AT&T, Facebook, Apple, Tesla, Visa and Amazon. Read more on my earnings outlook report. https://www.dailyfx.com/forex/fundamental/forecast/weekly/title/2021/01/17/Dow-Nasdaq-SP-500-Outlook-Earnings-May-Bring-Positive-Surprises.html
  • Wall Street Futures Update: Dow Jones (+0.20%) S&P 500 (+0.28%) Nasdaq 100 (+0.51%) [delayed] -BBG
  • Nearly 80% of the S&P 500 constituents closed in the red on Friday, dragged by materials (-0.43%), financials (-0.38%) and energy (-0.34%) whereas defensive utilities (+0.20%), real estate (+0.15%) and communication services (+0.02%) outperformed. https://t.co/vf08Fhfvxd
Risk On = Dollar Down, Right? So What Happened with NFPs?

Risk On = Dollar Down, Right? So What Happened with NFPs?

Michael Boutros, Strategist
Risk_On_Dollar_Down_Right_So_What_Happened_with_NFPs_body_Picture_2.png, Risk On = Dollar Down, Right? So What Happened with NFPs?Risk_On_Dollar_Down_Right_So_What_Happened_with_NFPs_body_Picture_3.png, Risk On = Dollar Down, Right? So What Happened with NFPs?

The greenback is firmer ahead of the close of North American trade with the Dow Jones FXCM Dollar Index (Ticker: USDollar) advancing 0.29% on the session. While today’s strong NFP print saw equities pare some of the early losses, the advance was short lived with stocks retreating once again in afternoon trade. Non-farm payrolls climbed by 200K, besting calls for a print of just 155K with the unemployment rate unexpectedly doping to 8.5% from 8.6%. While US data continues to improve, concerns regarding the deteriorating conditions in Europe have continued to weigh on broader market sentiment with European equities closing lower on the day. Various times throughout the week I’ve noted that we expect to see the inverse dollar/equity correlation breakdown this year with the dollar acting favorably to positive US data flow. Today we saw a hint of this decoupling as the dollar surged across the board on the stronger-than-expected employment data while equities moved higher. While the correlation still holds as of now, look for this to become more prominent later in the year as stronger US data decreases the likelihood of further quantitative easing and increases the likelihood the Fed will begin normalizing monetary policy.

The dollar breached the 10,000 level noted in yesterday’s report before encountering resistance at former trendline support, currently at 10,030. The index now eyes key resistance at the 76.4% Fibonacci extension taken from the August 1st and October 27th troughs at 10,070. While we expect a test of this level sometime this month, the greenback is likely to pare some of this week’s gains after three consecutive days of advances. The RSI reversal noted earlier this week has continued to support our bias with the oscillator crossing back above the 50-level as the slope steepens further.

Risk_On_Dollar_Down_Right_So_What_Happened_with_NFPs_body_Picture_4.png, Risk On = Dollar Down, Right? So What Happened with NFPs?

A slight adjustment to our soft resistance targets show the index rebounding off the 10,030 mark just ahead of the European close. Interim support now rests at the 10,000 level, backed by soft support at 9980, the 61.8% Fibonacci extension at 9950, and 9912. A breach of topside resistance eyes subsequent ceilings at trendline resistance dating back to the December 14th high and the 76.4 extension at 10,070. This level remains paramount for the dollar after failing four breach attempts late last year

Risk_On_Dollar_Down_Right_So_What_Happened_with_NFPs_body_Picture_5.png, Risk On = Dollar Down, Right? So What Happened with NFPs?

The greenback advanced against three of the four component currencies highlighted by a 0.52% advance against the euro which reached its lowest levels since September 2010. As officials struggle to ease market jitters over the deepening debt crisis, investors have continued to turn on the single currency with the euro off by more than 1.8% in the first week of 2012. Longer-term prospects for the euro remain weighted to the downside noting that a pullback of some magnitude is likely before continuing lower. The top performer of the lot was the yen which continues to hold its ground as the low yielder continues to benefit from risk-off flows. The USD/JPY remains well supported at these levels with any advances in the yen likely to be tempered by ongoing intervention concerns.

Year to date the greenback has outperformed all the component currencies save the aussie which has gained 0.20% this week. Notwithstanding developments out of Europe, look for the dollar to pullback early next week before mounting an offensive that should see the index top the 10,070 key resistance level later this month.

--- Written by Michael Boutros, Currency Analyst with DailyFX.com

To contact Michael emailmboutros@dailyfx.comor follow him on Twitter @MBForex.

To be added to Michael’s email distribution list, send an email with subject line “Distribution List” to mboutros@dailyfx.com

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

DISCLOSURES