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
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
Mixed
Wall Street
Mixed
Gold
Bullish
GBP/USD
Mixed
USD/JPY
Mixed
More View more
Real Time News
  • 🇲🇽 Unemployment Rate (DEC) Actual: 3.8 Expected: 4.3% Previous: 4.4% https://www.dailyfx.com/economic-calendar#2021-01-21
  • 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 70.59%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/fRoUoqtGbc
  • Heads Up:🇲🇽 Unemployment Rate (DEC) due at 12:00 GMT (15min) Expected: 4.3% Previous: 4.4% https://www.dailyfx.com/economic-calendar#2021-01-21
  • Commodities Update: As of 11:00, these are your best and worst performers based on the London trading schedule: Silver: 0.31% Gold: 0.02% Oil - US Crude: -0.82% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/Kn8mdyS57Y
  • Forex Update: As of 11:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.53% 🇬🇧GBP: 0.43% 🇦🇺AUD: 0.27% 🇨🇭CHF: 0.18% 🇯🇵JPY: 0.10% 🇨🇦CAD: 0.03% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/mwWxyHchSd
  • Euro’s forecast this quarter? Get your free forecast here: https://t.co/kpBYVz31Bd #DailyFXGuides https://t.co/Im099ElT61
  • Indices Update: As of 11:00, these are your best and worst performers based on the London trading schedule: Germany 30: 0.49% US 500: 0.24% Wall Street: 0.16% FTSE 100: 0.14% France 40: -0.07% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/rsPhYcZW22
  • #HSI Hang Seng Index finished slightly below 30,000 mark as Southbound net flow via the stock connections fell three days in a row to HK$ 16,263 million, from a record high of 26,592 million on Jan 19th. Total southbound flows contributed to 31% HKEX's daily turnover on Thur. https://t.co/YkxXUHEFRa
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn more about controlling greed here: https://t.co/5GXReUsKRj https://t.co/edSSfv0SfT
  • Join @PaulRobinsonFX 's webinar at 5:30 AM EST/10:30 AM GMT where you can learn how to become a better trader in the current market climate. Register here: https://t.co/WeWGKtdlyz https://t.co/MPcM0lepdX
Aussie Rallies on Calm RBA; Euro Weakens on Growth Forecasts, LTRO News

Aussie Rallies on Calm RBA; Euro Weakens on Growth Forecasts, LTRO News

Christopher Vecchio, CFA, Senior Strategist

ASIA/EUROPE FOREX NEWS WRAP

We now know where all of the major central banks stand: the Federal Reserve is looking to tighten policy; the Bank of Canada says a rate hike is “less imminent”; the Swiss National Bank is ready to raise the EURCHF floor to 1.2500 if necessary; a divided Bank of England will brush aside higher inflation to stoke growth; and the Reserve Bank of New Zealand is willing to intervene to ‘smooth the peaks’ in the Kiwi. Today, we learned both the European Central Banks and the Reserve Bank of Australia’s position: they will not exchange shots in the ‘currency war.’ Here’s why:

RBA Governor Glenn Stevens said that “there is a good deal of interest rate stimulus in the pipeline” to a parliamentary committee today, essentially undercutting rate cut hopes for the upcoming meeting in March. What would be the trigger for a move?- if the Australian Dollar became “seriously overvalued” – a condition that is not close to being met. If the inflation outlook is expected to improve, due to the “stimulus in the pipeline,” a high Aussie exchange rate could insult consumers from diminished purchasing power. So, the RBA is on the sidelines in the ‘currency war,’ and the Australian Dollar is the top performer on the day.

On the other hand, not only is the ECB refusing to weaken the Euro, the ECB continues to reign in its balance sheet. LTRO2 repayments came in today, at a clip of €61.1B as opposed to the €122.5B forecasted by Bloomberg News. While the disappointment has led to Euro weakness, it still represents a significant material drawdown in the ECB’s balance sheet, effectively a tightening of policy. Alongside the very weak European Union growth forecasts released earlier today, it’s evident that the ECB is stuck on the sidelines, if not by choice, but by necessity. A rate cut shouldn’t be ruled out in the 2Q’13 or 3Q’13, however.

Taking a look at European credit, peripheral yields have compressed despite the LTRO repayment data, yet the Euro remains lower on Friday. The Italian 2-year note yield has decreased to 1.676% (-1.8-bps) while the Spanish 2-year note yield has decreased to 2.510% (-0.3-bps). Likewise, the Italian 10-year note yield has decreased to 4.449% (-3.6-bps) while the Spanish 10-year note yield has decreased to 5.132% (-4.9-bps); lower yields imply higher prices.

RELATIVE PERFORMANCE (versus USD): 11:35 GMT

AUD: +0.85%

NZD: +0.65%

GBP: +0.08%

CHF:0.00%

CAD:-0.04%

EUR:-0.05%

JPY:-0.11%

Dow Jones FXCM Dollar Index (Ticker: USDOLLAR): -0.08% (+0.40% past 5-days)

ECONOMIC CALENDAR

Aussie_Rallies_on_Calm_RBA_Euro_Weakens_on_Growth_Forecasts_LTRO_News_body_Picture_7.png, Aussie Rallies on Calm RBA; Euro Weakens on Growth Forecasts, LTRO News

See the DailyFX Economic Calendar for a full list, timetable, and consensus forecasts for upcoming economic indicators.

TECHNICAL ANALYSIS OUTLOOK

Aussie_Rallies_on_Calm_RBA_Euro_Weakens_on_Growth_Forecasts_LTRO_News_body_Picture_6.png, Aussie Rallies on Calm RBA; Euro Weakens on Growth Forecasts, LTRO News

EURUSD: No change: “The move below 1.3280 has been swift, and while the initial thought was to look to buy weakness, it seems that there are two significant uptrends on the verge of breaking: the ascending trendline off of the December and January lows at 1.3240; and the ascending TL off of the July and November lows at 1.3190. Additionally, the weekly RSI uptrend since mid-July has broken lower. 1.3050/70 is support, followed by 1.3000 and 1.2870/90. Resistance is 1.3280/300.”

Aussie_Rallies_on_Calm_RBA_Euro_Weakens_on_Growth_Forecasts_LTRO_News_body_Picture_5.png, Aussie Rallies on Calm RBA; Euro Weakens on Growth Forecasts, LTRO News

USDJPY: No change: “Further bullish price action as US Treasury yields strengthen and speculation over BoJ policy arises again.” Resistance comes in at 93.40/45 (monthly R1), 93.85 (weekly R1) and 94.00/10. Support comes in at 92.90/95 (weekly pivot), and 91.75/95 (weekly S1). Recent price action may be a top or a Bull Flag; waiting for confirmation above 95.00 or below 92.00.

Aussie_Rallies_on_Calm_RBA_Euro_Weakens_on_Growth_Forecasts_LTRO_News_body_Picture_4.png, Aussie Rallies on Calm RBA; Euro Weakens on Growth Forecasts, LTRO News

GBPUSD: No change: “Selling persists on further bad data from the UK and dovish commentary from the BoE, setting up for a test of the significant June 1 low at 1.5265/70. With technical conditions extremely oversold on shorter-term timeframes (1H and 4H) and longer-term views moving to extremes as well, a rebound at such a significant level wouldn’t be surprising. Support comes in there and 1.5000. Resistance is 1.5425/50, 1.5560/80, and 1.5660/80. [A massive daily Hammer has formed] – it appears the rebound may be finding footing.”

Aussie_Rallies_on_Calm_RBA_Euro_Weakens_on_Growth_Forecasts_LTRO_News_body_Picture_3.png, Aussie Rallies on Calm RBA; Euro Weakens on Growth Forecasts, LTRO News

AUDUSD:No change: “The bounce from the 1.0265/90 area may have completed, with the rally halted at the 200-DMA at 1.0305/10. The pair is sitting at the 100% extension at 1.0265 now, and a break implies a deeper setback towards 1.0135/75, early-September and –October swing lows, as well as the 161.8% extension. Although there was an overshoot into 1.0360, former support, failure has occurred, signaling further downside is possible. Price has struggled further to overcome this level. I’m still looking for a move into 1.0135/75.” Note: a potential Morning Star candlestick cluster – a bullish reversal pattern – may be forming on the daily chart.

Aussie_Rallies_on_Calm_RBA_Euro_Weakens_on_Growth_Forecasts_LTRO_News_body_Picture_2.png, Aussie Rallies on Calm RBA; Euro Weakens on Growth Forecasts, LTRO News

S&P 500: No change: “The 100% Fibonacci extension on the fiscal cliff rally and flag comes in at 1530. Bottom line: I’m expecting a significant setback (-10%) in the S&P 500 unless volumes accelerate rapidly, given the disconnect from reality. The setback has started, with the S&P 500 reversing sharply off of 1530, and putting in a daily Bearish Key Reversal yesterday. Time to start looking lower. Support comes in at 1500 and 1475. Resistance is 1520 and 1530.”

Aussie_Rallies_on_Calm_RBA_Euro_Weakens_on_Growth_Forecasts_LTRO_News_body_Picture_1.png, Aussie Rallies on Calm RBA; Euro Weakens on Growth Forecasts, LTRO News

GOLD: No change: “Gold broke below trendline support off of the January 2011 and May 2012 lows at 1650 last week, prompting a sharp sell-off into 1600, where price broke out in mid-August before a rally into the post-QE3 high at 1785/1805. However, with oversold conditions persisting on the 4H and daily timeframes, a rebound should not be ruled out; each of the past two daily RSI oversold readings has produced a rally in short order. Resistance is 1625 and 1645/50. Support is 1585 and 1555/60. It should be noted that Gold has entered a major support zone from the past 18-months from 1520 to 1575.”

--- Written by Christopher Vecchio, Currency Analyst

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form

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

DISCLOSURES