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
EUR/USD
Bearish
Oil - US Crude
Bullish
Wall Street
Bearish
Gold
Bearish
GBP/USD
Bearish
USD/JPY
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
More View more
Real Time News
  • The ISM manufacturing index plays an important role in forex trading, with ISM data influencing currency prices globally. Find out about the recent history of ISM data, how to track it, and how to trade its release here: https://t.co/MZtBh88nOv https://t.co/hQgZB9T73q
  • 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/vg7w10CKUR https://t.co/9JVh6BsWa2
  • There’s a strong correlation between interest rates and forex trading. Forex is ruled by many variables, but the interest rate of the currency is the fundamental factor that prevails above them all. Learn how interest rates impact currency markets here: https://t.co/J0EPMD2Cfi https://t.co/ZDuee58Abe
  • Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Learn about FX leverage here: https://t.co/BdgFmkRxVw https://t.co/niJL2W2yXV
  • 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/0rNbbrd58e
  • Traders utilize varying time frames to speculate in the forex market. The two most common are long- and short-term-time frames which transmits through to trend and trigger charts. Learn more about time-frame analysis here: https://t.co/9S5tXIs3SX https://t.co/zPzJAxBJxt
  • Emotions are often a key driving force behind FOMO. If left unchecked, they can lead traders to neglect trading plans and exceed comfortable levels of risk. Read on and get your emotions in check here: https://t.co/eILWbFgHRE https://t.co/uf6KEYTes5
  • There are three major forex trading sessions which comprise the 24-hour market: the London session, the US session and the Asian session. Learn about the characteristics of each session here: https://t.co/reRmDe1Ksp https://t.co/gRjdVfbg66
  • Implementing a trading checklist is a vital part of the trading process because it helps traders to stay disciplined, stick to the trading plan, and builds confidence. Learn how to stick to the plan, stay disciplined, and use a checklist here: https://t.co/SQUCCYRCIk https://t.co/mLLGqYUygY
  • Use this technical analysis pattern recognition skills test to sharpen your knowledge: https://t.co/Qgz89PTxnu https://t.co/HUYJzEkYiT
Dollar Uninspired, SPX Crawls Higher as FOMC Raises the Stakes

Dollar Uninspired, SPX Crawls Higher as FOMC Raises the Stakes

John Kicklighter, Chief Strategist

Talking Points:

  • The Fed minutes showed the group is ready to hike in June and expects to start its QE selloff this year
  • Despite the upgrade in tightening efforts, the Dollar gained little traction, the SPX crawled higher and VIX sunk to 10
  • A China credit downgrade by Moody's raises international risks but perhaps the NATO and G7 meetings will be more pressing

Short interest on EUR/USD has been rising steadily these past few weeks while net short retail positioning has hit its most extreme in at least six months? See the IG positioning statistics on the DailyFX sentiment page.

Risk trends wavered this past session, but certainly wouldn't find its direction despite both scheduled and unscheduled fundamental revelations throughout the session. The question traders and investors should be asking is whether complacency is indeed this deeply set or if the market is just keeping its powder dry for surprises from the key international meetings immediately on the horizon (the NATO and G7 summits). Either way, the market is refusing to break from its volatility fast. The S&P 500 has extended its slow speculative advance to a five-day climb - its first since February) to a 'technical' record high. Meanwhile, from the VIX volatility index, the retreat has brought it back to the 10 level. This puts us back into the record-setting low range that adds 'extreme' moniker to exceptionally low activity levels. This is equal parts complacency and speculative pressure to force the quiet trade. This adds significant risk to an exposure that is already barren of return.

This past session's lack of progress comes as something of a surprise considering there were a few remarkable developments on the fundamental backdrop. The first development early in the trading day was rating agency Moody's downgrade of China (and later Hong Kong). This carries serious practical risk, but a veil of confidence can minimize the threat in the near-term. A downgrade in credit quality for the world's second largest economy can further spur capital flight from this carefully controlled financial system and nudge up the percentage of bad loans on a system that is arguably flirting with a bubble. Nevertheless, neither the Chinese Yuan (USD/CNH) nor Hong Kong Dollar (USD/HKD) budged. That isn't too surprising given the authorities' control over these exchange rates. Later, in the US session, the FOMC minutes continued to lay the path towards a more substantial withdrawal of easy policy. The transcript of this month's meeting showed not only that support for a near-term rate hike - perhaps as early as June 14th - but it showed most officials supported a start in QE reductions this year. Given the market's reaction to the groups taper years ago, what will an actual selling of assets translate into?

Grand Dollar and risk trends aren't the only fundamental themes on display. This past session had both headlines and some volatility in isolated corners. Among a range of central bank activity, the aggressive doves in the ECB and BoJ offered little to move on while the otherwise neutral BoC's (Bank of Canada) in-line call led to a strong USD/CAD slide. For truly remarkable performance, we look to Bitcoin which continues to soar to record highs. Reports of adoption by Fidelity in a retail capacity and agreements on pursuing scalability has added lift to this already ebullient market. Looking ahead to tomorrow, the attention may once again turn back to the concentrated, high-profile themes. Populism and protectionism will be back in the headlines - for better or worse - with the second day of the NATO summit. US President Trump made very disparaging remarks about the defense relationship on the campaign trail and tension remains high. The President will also meet with European Union leaders Juncker and Tusk to account for the US-European economic relationship. Oil traders should also keep tabs on the OPEC gathering which will test a very active oil market. We discuss event risk and market activity in today's Trading Video.

To receive John’s analysis directly via email, please SIGN UP HERE

Dollar Uninspired, SPX Crawls Higher as FOMC Raises the StakesDollar Uninspired, SPX Crawls Higher as FOMC Raises the Stakes

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

DISCLOSURES