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
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
Oil - US Crude
Mixed
Wall Street
Mixed
Gold
Mixed
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • What are some trading takeaways from 2020, as we jump into the new year? Find out with your free guide here: https://t.co/e7udCTJlmf #DailyfxGuides https://t.co/9bsQkh2WMF
  • Trading Forex is not a shortcut to instant wealth, excessive leverage can magnify losses, and sentiment is a powerful indicator. Learn about these principles in depth here: https://t.co/lZFM8youtX https://t.co/DJccj3qiig
  • Risk management is one of the most important aspects of successful trading, but is often overlooked. What are some basic principles or risk management? Find out from @PaulRobinsonFX here: https://t.co/IsnpfJhp91 https://t.co/UK4E7wD6s8
  • Copper is on track to make a sixth consecutive monthly gain as prices inch towards its all-time high. The global backdrop remains supportive despite a short-term pause in the rally. Get your market update from @FxWestwater here:https://t.co/STEYeIG042 https://t.co/R794ENkS3c
  • Retail trader signals still hint that the Dow Jones and S&P 500 may be at risk, placing the focus on year-long rising trendlines to see if dominant upside biases hold.Get your market update from @ddubrovskyFX here:https://t.co/lFpzIFNmzW https://t.co/FoHTLDJWJe
  • The path for the Japanese Yen seems to favor the downside looking at a majors-based index. USD/JPY may rise within its Ascending Channel, but there is some scope for a healthy correction. Get your market update from @ddubrovskyFX here:https://t.co/7XFJiCYYEM https://t.co/KfLyB2t1jP
  • The British Pound’s recent slip lower against its major counterparts may prove short-lived. Key levels to watch for GBP/USD, GBP/JPY, GBP/CHF and EUR/GBP. Get your $GBP market update from @DanielGMoss here:https://t.co/Y48cF2qi9M https://t.co/ia3Bgq0ZTp
  • Senate Democrats reach deal on jobless aid -BBG
  • The US Dollar faces its next key tests against ASEAN FX following gains in USD/SGD, USD/IDR, USD/PHP and USD/THB. Are the breakouts losing momentum? Get your market update from @ddubrovskyFX here:https://t.co/joPnWIcxEN https://t.co/4QAlUyD98V
  • Heads Up:🇨🇳 National People's Congress due at 00:00 GMT (15min) https://www.dailyfx.com/economic-calendar#2021-03-06
NFPs Drive Dollar to 8 Month Low; VIX, Euro and Pound in Spotlight

NFPs Drive Dollar to 8 Month Low; VIX, Euro and Pound in Spotlight

John Kicklighter, Chief Strategist

Talking Points:

  • NFPs were not 'bad' enough to turn off risk trends or lower Fed rate forecasts, but they did lower Dollar to 8 month lows
  • Risk-directed assets continue to diverge and extreme positioning on VIX reminds us of the deep complacency this reflects
  • Euro faces the ECB rate decision, Pound the UK election, Aussie Dollar the RBA and 1Q GDP

Trends and clear fundamental themes are in short supply nowadays. Dialing down trade time frame and following high profile event is the more adaptable approach to markets. Sign up for the live webinar coverage of the ECB, RBA and Canadian jobs on the DailyFX Webinar Calendar.

We are heading into a speculative dichotomy: June is one of the quietest trading months of the calendar year historically; but markets sporting record complacency while event risk grows in scale. Once again we return to the constant speculative question: will this time be different? That is a question for market's as a whole to decide rather than a trader to intuit through analysis. Market participants need to remain observant and adaptable when the consensus shifts. Through this past week, it seemed as if we were on pace for a deeper dive into the summer lull. We ended the period with the May NFPs. The miss was significant and drove the ICE's Dollar Index (DXY) to a fresh 8-month low, but the fundamental motivation didn't spread to the rest of the financial system. US equities advanced to a record high and the VIX volatility index finished below 10 for the seventh time in a month. The mixed speculative response should lead us to greater caution rather than relief and confidence though.

Where the S&P 500 charged to record highs through the close of this past week, the spectrum of 'risk' assets maintained an increasingly divergent course. Global equity indexes are running different paces, the high yield fixed income market holds its hesitance and carry trade remains expressly weak. This diminished correlation offers some concern as it speaks to a lack of drive. The speculative drive behind the VIX reminds us of the risk. As extreme as the volatility index's lows are, futures traders are still holding a remarkable net short exposure to the supposedly hedging product in a clearly speculative effort to stretch their reach for return. As we monitor political, economic and financial risks for sentiment triggers; the monetary policy landscape will play a considerable roll for volatility moving forward.

The NFPs this past week missed expectations but extended a record-breaking string of months that jobs have been added to the economy. While the Greenback did slide to a new low, it likely found little of its motivation from this event risk. Looking at interest rate expectations derived from Fed Funds futures, the market sees a 92 percent probability of a hike come June 14th. The countdown to that important policy meeting will likely throttle the Greenback against any major trends or reversal. In contrast, the ECB (European Central Bank) and RBA (Reserve Bank of Australia) rate decisions this week can generate significant FX response with the proper outcome. The Australian central bank is unlikely to change its benchmark rate, but we've seen that market has been particularly sensitive to hints and insinuation for future change. For the ECB, a much more profound debate exists. Will this leader in dovish policy start laying the track for its eventual rate hikes and stimulus scrubbing as some members have called for? This would be a profound change in direction not just for this central bank and region but for global monetary policy. We discuss the key themes of risk trends and monetary policy along with other top event risk (like the UK election) and remarkable technical standings (gold's weekly chart) in this weekend Trading Video.

NFPs Drive Dollar to 8 Month Low; VIX, Euro and Pound in SpotlightNFPs Drive Dollar to 8 Month Low; VIX, Euro and Pound in SpotlightNFPs Drive Dollar to 8 Month Low; VIX, Euro and Pound in SpotlightNFPs Drive Dollar to 8 Month Low; VIX, Euro and Pound in Spotlight

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

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

DISCLOSURES