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DailyFX US AM Digest: US Dollar Can’t Catch a Bid; Euro Climbs Again

DailyFX US AM Digest: US Dollar Can’t Catch a Bid; Euro Climbs Again

Research, Research Team


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Despite another push higher by US Treasury yields, the US Dollar has been unable to find a bid on Tuesday, wiping out all of Monday’s gains. If the DXY Index, trading below 89.00 at the time this report was written, were to close at its current levels or lower, it would be at its lowest close since December 16, 2017. Accordingly, with Q4’17 Euro-Zone GDP data beating expectations, EUR/USD has been able to restart its climb higher. Elsewhere, attention is on US equity markets after yesterday’s decline (for the S&P 500 and the DJIA, the largest of 2018 so far); another triple-digit loss on the Dow would be the first time we’ve seen two consecutive triple-digit declines since April 2017.

DailyFX Economic Calendar: Tuesday, January 30, 2018 – North American Releases

Among an otherwise busy week, Tuesday is the quietest day on the calendar for the North American session. Once again, there are no Canadian data due, and only one ‘high’ importance event from the United States: January Consumer Confidence. Confidence readings have had little impact on FX markets in recent months as the disconnect between sentiment (“soft data”) and the real economy (“hard data”) remains evident. If anything, confidence readings have proven to be a better reflection of the stock market’s gains. Later, at 21 EST (Monday)/2 GMT (Tuesday), US President Donald Trump will deliver his first State of the Union address.

DailyFX Webinar Calendar: Tuesday, January 30, 2018

IG Client Sentiment Index Chart of the Day: GBPUSD

Learn more about the IG Client Sentiment Index on the DailyFX Sentiment page

GBPUSD: Retail trader data shows 42.3% of traders are net-long with the ratio of traders short to long at 1.36 to 1. In fact, traders have remained net-short since Dec 28 when GBPUSD traded near 1.33774; price has moved 5.7% higher since then. The number of traders net-long is 11.8% higher than yesterday and 31.0% higher from last week, while the number of traders net-short is 9.0% lower than yesterday and 22.0% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

Five Things Traders are Reading

  1. “Traders Urged to Respond to Proposed European Rule Changes” by Martin Essex, MSTA, Analyst and Editor, and Luigi Guida, Market Analyst
  2. “A Look Inside Bitcoin Traders’ Minds During the Cryptocurrency Crash” by Nick Cawley, Analyst, Paul Robinson, Market Analyst, and Christopher Vecchio, CFA, Senior Currency Strategist
  3. “Technical Outlook for Gold, Crude Oil, DAX & More” by Paul Robinson, Market Analyst
  4. “Ethereum Leads, Bitcoin & Other Cryptocurrency Charts Readying for Moves” by Paul Robinson, Market Analyst
  5. “GBP/USD Slips Ahead of BoE’s Carney and US President Trump’s Thoughts” by Nick Cawley, Analyst

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