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
Wall Street
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
More View more
Real Time News
  • The continuity seen across these volatility cycles is a good thing. Historical precedence offer a blueprint for identifying conditions supportive for a vol-event to occur, and how they may unfold. Deepen your knowledge of historical volatility here: https://t.co/vg7w10la3j https://t.co/lx3cMSpZNc
  • Further your forex knowledge and gain insights from our expert analysts on EUR with our free guide, available today: https://t.co/XtydfUNW0y https://t.co/n4NXZUovb0
  • Scoping out next week for trading the market, there are a range of high profile influences including September PMIs, Evergrande and a range of central bank decisions. Top listing on my docket is the #FOMC with my scenarios below. Full analysis: https://www.dailyfx.com/forex/video/daily_news_report/2021/09/18/SP-500-and-Dollar-on-the-Hook-for-Breaks-with-Evergrande-Fed-and-September-Trade-Ahead.html https://t.co/ZdoMJS9fp5
  • Looking for a new way to trade reversals? One of the most used reversal candle patterns is known as the Harami. Like most candlestick formation patterns, the Harami tells a story about sentiment in the market. Get better with trading reversals here: https://t.co/rfwUWJfbz9 https://t.co/Q3Yfe6TMLw
  • The non-farm payroll (NFP) figure is a key economic indicator for the United States economy. It is also referred to as the monthly market mover. Find out why it has been given this nickname here: https://t.co/yOUVEEqhc5 https://t.co/6inC94w5K4
  • All eyes on the Fed on Wednesday as investors weigh on chances of a taper announcement. Get your weekly equities forecast from @HathornSabin here: https://t.co/Cv06XcvldF https://t.co/I12g2YPkdE
  • Knowing how to accurately value a stock enables traders to identify and take advantage of opportunities in the stock market. Find out the difference between a stock's market and intrinsic value, and the importance of the two here: https://t.co/QszmdZFxlk https://t.co/KsPiWBysiR
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here: https://t.co/Yl9vM7kO6a https://t.co/iUvhLfQgcK
  • The US Dollar caught a bid in the late part of last week to set a fresh September high. FOMC is around the corner, are bulls going to be able to push for another fresh high? Get your weekly US Dollar forecast from @JStanleyFX here: https://t.co/ZkDHyV1VhM https://t.co/w5sPChKdNx
  • The Federal Reserve System (the Fed) was founded in 1913 by the United States Congress. The Fed’s actions and policies have a major impact on currency value, affecting many trades involving the US Dollar. Learn more about the Fed here: https://t.co/ADSC4sIHrP https://t.co/bde30KM8OE
US Dollar Coils for Big Move - Boom or Bust - amid Key Fed Events This Week

US Dollar Coils for Big Move - Boom or Bust - amid Key Fed Events This Week

Christopher Vecchio, CFA, Senior Strategist

INTRADAY PERFORMANCE UPDATE: 09:40 GMT

MAJORS

AUD

CAD

CHF

EUR

GBP

JPY

NZD

(vs USD)

+0.17%

+0.13%

+0.02%

+0.07%

+0.17%

-0.21%

+0.59%

Dow Jones FXCM Dollar Index (Ticker: USDOLLAR): -0.06% (-0.45%prior 5-days)

ASIA/EUROPE FOREX NEWS WRAP

It’s been a quiet start to the trading week thanks to a barren economic calendar; but with several important data and events due over the next few days, the newswires shouldn’t stay quiet for long. This week is notable in particular given two important Federal Reserve events that should give greater insight as to which way the central bank is leaning towards tapering QE3 in September.

On Wednesday, the first of the two Fed related events, the July FOMC meeting Minutes, could prove to be a bearish catalyst for the US Dollar. The policy statement released after the July meeting showed that policymakers had become wearier of the soft inflation backdrop, with the only dissenter from the June meeting falling back in line thanks to the dovish adjustment in language.

With the FOMC minutes setting a cautious yet hopeful backdrop for US growth prospects, the Jackson Hole Economic Policy Symposium scheduled to take place at the tail end of the week will be viewed purely through the lens of the QE3 taper.

Although Fed Chairman Bernanke won’t be there, that doesn’t mean that clues on QE3 won’t be present. A big focus will be whether or not policymakers feel that the US economy is strong enough to withstand (potentially sharply) higher interest rates at this point in the recovery. Volatility will then be derived from the juxtaposition of tapering QE3 in an improved growth environment versus a stumbling one.

As it stands now, the 'apocalypse' scenario looks unlikely to play out – that the Fed is looking to taper QE3 irrespective of any incoming data; surely a sign of asset bubbles having formed in global equity markets and US Treasuries.

EURUSD 5-min Chart: Monday, August 19 Intraday

US_Dollar_Coils_for_Big_Move_-_Boom_or_Bust_-_amid_Key_Fed_Events_This_Week_body_x0000_i1027.png, US Dollar Coils for Big Move - Boom or Bust - amid Key Fed Events This Week

With no news on the calendar today, consolidation is very much afoot, with the US Dollar trading within one-quarter of a percent against all of the majors but for the New Zealand Dollar. This period of relative calmness shouldn’t go beyond a day or two as currency markets have already shown signs of bracing for QE3 taper speculation.

Read more: Euro Fails to Gain Despite Improved GDP – Will PMIs Revive Optimism?

ECONOMIC CALENDAR – UPCOMING NORTH AMERICAN SESSION

There are no events on the calendar for Monday, August 19.

See the DailyFX Economic Calendar for a full list, timetable, and consensus forecasts for upcoming economic indicators. Want the forecasts to appear right on your charts? Download the DailyFX News App.

FX TECHNICAL ANALYSIS – CHART OF THE DAY

US_Dollar_Coils_for_Big_Move_-_Boom_or_Bust_-_amid_Key_Fed_Events_This_Week_body_x0000_i1028.png, US Dollar Coils for Big Move - Boom or Bust - amid Key Fed Events This Week

USDJPY (H1) – The USDJPY took a hard spill on Thursday and fell out of an ascending channel that guided price from the weekly low on Monday. However, choppy trading that past 48-hours may have produced a bottom, with a Bullish Ascending Triangle appearing and breaking to the upside on the H1 timeframe.

As such, with prior intraweek swing resistance coming in at ¥98.25/40, gains could accelerate on Monday before sellers reenter the picture some 30-50-pips higher. At that point, the H1 RSI and H1 Slow Stochastics (5,3,3), both of which are presently bullish, should be in overbought territory indicating a point to trim back bullish bets (should such a situation play out).

--- 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