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.

Free Trading Guides
EUR/USD
Bearish
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
GBP/USD
Bearish
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
USD/JPY
Bullish
Gold
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
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
Bitcoin
Bearish
More View more
Real Time News
  • What are the six different types of stocks every trader should know? Find out from @WVenketas here: https://t.co/yO3Jal2Pwk https://t.co/ukJof0fWYH
  • Hey, traders 👋 do you want live AMAS with our analysts, market updates and tools to improve your trading strategy? Join us now on Instagram! 👉 https://t.co/pHGzVMI3tC https://t.co/AJHmBpX6gd
  • RT @malkudsi: Canadian Dollar Weekly Forecast: USD/CAD Reverses Lower, What’s Next? More details in the link below: https://t.co/gcN0SU2…
  • BOJ's Kuroda: - BOJ economic forecasts are based on different assumptions vs those of the government - BOJ path for CPI ends up being higher than government projection #JPY
  • RT @YuanTalks: Hubei privince, the epicenternof the #coronavirus cases, has revised the number of new cases on Thursday upward to 631 from…
  • A brief $AUD recovery may have run out of steam, with the currency poised to break range support and test below 0.66 against its US counterpart. Get your market update from @IlyaSpivak here:https://t.co/dqr2Vpbnjk https://t.co/HIq0i37RbY
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.02%, while traders in France 40 are at opposite extremes with 80.94%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/tiK3d5TnFL
  • Forex Update: As of 05:00, these are your best and worst performers based on the London trading schedule: 🇬🇧GBP: 0.12% 🇯🇵JPY: 0.11% 🇨🇭CHF: 0.10% 🇨🇦CAD: 0.08% 🇦🇺AUD: -0.13% 🇳🇿NZD: -0.34% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/WGWYCqlCT1
  • Indices Update: As of 05:00, these are your best and worst performers based on the London trading schedule: Germany 30: -0.27% France 40: -0.31% Wall Street: -0.41% US 500: -0.47% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/cOwOxBR3WQ
  • 🇯🇵 JPY All Industry Activity Index (MoM) (DEC), Actual: 0.0% Expected: 0.3% Previous: 0.9% https://www.dailyfx.com/economic-calendar#2020-02-21
Greenback Under Pressure But Trying to Find Bids on Month End Flows

Greenback Under Pressure But Trying to Find Bids on Month End Flows

2011-02-25 12:12:00
Joel Kruger, Technical Strategist
Share:

Although the Euro creeps higher towards next key resistance by 1.3860, there are not a lot of new developments as price action remains primarily influenced by ongoing turmoil in North Africa and the Middle East. The escalation in geopolitical tensions has resulted in a surge in oil prices, and many now fear that this could be the very development which ultimately depresses the global economy into a double dip recession scenario. Safe haven currencies remain the primary beneficiaries of this price action, with the Swiss Franc standing out the most as it trades by fresh record highs. Meanwhile, the Yen has also been well bid on similarly correlated flows. However, we have been seeing some mild USD buying on Friday and there has been talk of additional demand for the Greenback on month end related flows.

Relative Performance Versus USD Friday (As of 11:45GMT)

  1. NZD +0.40%
  2. AUD +0.40%
  3. CAD +0.14%
  4. JPY -0.01%
  5. EUR -0.12%
  6. CHF -0.23%
  7. GBP -0.30%

The rally in the Euro this week has been somewhat of an anomaly considering that we have seen no real fundamental changes in the Eurozone that would warrant such a rally. While it is true that the market has benefitted a great deal from talk of a potential shift to a more hawkish stance at the ECB, at the end of the day, it is only talk and nothing has been substantiated. In fact, we have been seeing some reason for additional Eurozone concern, with Greek, Irish and Portuguese bond spreads widening out, and many once again wondering whether there will be issues with these countries abilities to repay the debt. Certainly, the higher oil prices do not help matters and could act as an additional strain. Market participants should also pay attention as Ireland elections are underway. A victory by the opposition could also ruffle some feathers.

On the data front, we have seen UK GfK consumer confidence come in slightly softer than expected, while provisional Q4 GDP results have also been on the weak side. This in conjunction with comments from BOE Posen who says that he is not concerned with inflation because of lower wage growth, should continue to keep the Pound relatively underperforming. Also out have firmer than forecast German inflation readings, and a very solid Swiss KOF. Finally, the Canadian Dollar should be watched closely on Friday, with USD/CAD finally breaking down below 0.9800 barriers.

Looking ahead, we have opted to lay things out for you with the schedule for the remainder of the day. US equity futures and oil prices are tracking higher ahead of North America, while commodities consolidate their most recent moves.

ECONOMIC CALENDAR FOR NORTH AMERICA:

Morning_SLices_body_Picture_5.png, Greenback Under Pressure But Trying to Find Bids on Month End Flows

TECHNICAL OUTLOOK

Morning_SLices_body_eur.png, Greenback Under Pressure But Trying to Find Bids on Month End Flows

EUR/USD:The market remains very well bid, with key short-term resistance by 1.3745-65 being easily cleared to now put the focus on next topside barriers at 1.3860. The 1.3860 level represents the current yearly high, and a break above will then open the door for a fresh upside extension towards psychological barriers by 1.4000 which also guard against the more significant medium-term resistance at 1.4285 from November 2010. There is still however the risk that the market stalls out in the 1.3800’s, but a failure at or near 1.3860, and break back below 1.3700 would be required at a minimum to relieve current topside pressures.

Morning_SLices_body_jpy2.png, Greenback Under Pressure But Trying to Find Bids on Month End Flows

USD/JPY: Although the market has come under some intense pressure in recent trade back below 82.00, overall price action remains largely consolidative and we would expect to see the market once again well supported in the 81.00’s. For now, 81.00 remains the key level to watch below, and only a close below this figure would negate the current range-bound price action and give reason for concern. As such, we like the idea of buying on dips into the 81.00’s in favor of a bullish reversal and close back above 82.00.

Morning_SLices_body_gbp2.png, Greenback Under Pressure But Trying to Find Bids on Month End Flows

GBP/USD: The market largely remains locked in some consolidation after continuously stalling out by and ahead of key resistance at 1.6300. From here, it is difficult to establish a clear directional bias and we will need to see a sustained break above 1.6300 or back below 1.6100 for additional clarity.

Morning_SLices_body_swiss1.png, Greenback Under Pressure But Trying to Find Bids on Month End Flows

USD/CHF: The latest break to fresh record lows below 0.9250 is certainly concerning and threatens our longer-term recovery outlook. Still, we do not see setbacks extending much further and continue to favor the formation of some form of a material base over the coming weeks in favor of an eventual break back above parity. From here, big figures become key support as we are in unchartered territory, while a break back above 0.9400 would be required to relieve immediate downside pressures.

FLOWS

US prime name keeps the range early in Nzd/Usd, buying by retail investors in Aud/Usd. A Canadian name seen on the offer in Usd/Cad with a model account on the bid. Talk of an ACB defending the 1.3850 level in Eur/Usd with spec accounts keen to buy dips. Swiss, German and French banks have all been selling Cable this morning. Talk of month end buying is USDs by corporate types. A US custodial name has been an active USD buyer across the board, most notably in Usd/Jpy.

CLICK HERE FOR PORTFOLIO OVERVIEW

Written by Joel Kruger, Technical Currency Strategist

If you wish to receive Joel’s reports in a more timely fashion, email jskruger@dailyfx.com and you will be added to the distribution list.

If you wish to discuss this or any other topic feel free to visit our Forum Page.

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

DISCLOSURES

News & Analysis at your fingertips.